Variable Cost-Plus Pricing

See: Variable Cost.

It's difficult to price items that change in price constantly. Like how lobster gets listed as "market price" on a menu. The restaurant can't guess day to day what the price will be, so they just tell you "We'll figure it out when its time to make up the bill."

Or...think about gasoline. The price listed changes everyday, reacting to changes in the price of crude oil and wholesale gas. Crude and wholesale gas represent variable costs; they change moment to moment based on market conditions. Your local gas station has to react to those changes over time. So, fundamentally, they adopt a variable cost-plus pricing model. They take the cost of the wholesale gas they receive, and add some amount to it.

As wholesale gas prices change, the retail price you pay at the pump changes accordingly. The price you pay is determined by the variable price of wholesale gasoline, plus the added amount the gas station puts on top for their trouble.