Assume it costs Lady Marion Seafood, Inc. $30 to catch, process, freeze, package, and ship 5-pound packages of Alaskan salmon. The firm adds 60 percent to the cost of its salmon products and charges customers a total of $48 for a postage-paid vacuum-sealed package. What type of pricing does Lady Marion Seafood use to arrive at its final price?

Standard markup pricing

Explanation:

Standard markup pricing is a fast an easy way to determine the price to charge for the goods and services being offered. It is calculated individually for each item based on the items costs. The standard markup price is calculated by adding the actual cost of the item to the mark up price. For this problem, the actual cost of the item is $30 and the mark up price is 60%. Therefore the markup price = 0.6 * $30 = $18

Standard markup price = Actual cost + markup price = $30 + $18 = $48

Answer: Standard Markup pricing

Explanation: When pricing is made using the formula:

Price = actual price + markup. Then thw standard markup pricing strategy is in play. The seller or business owner after calculating the actual cost of production adds a certain percentage of the actual cost to arrive at his or her selling price for the product.

In the scenario above,

Actual cost of Lady Marion Sea food Inc. is $30

Markup is 60% of actual cost : 0.6 * $30 = $18

Therefore,

Selling price = $ (30 + 18) = $48