Maple IncManufactures a Product That Costs $45 Per Unit Plus $50,000

question 118

Multiple Choice

Maple Inc.manufactures a product that costs $45 per unit plus $50,000 in fixed costs each month.Maple currently sells 5,000 of these units per month for $60 each.If Maple leased a machine for $30,000 a month,it could add features to the product that would allow it to increase the selling price.It would cost an additional $10 per unit to add these features.How much would Maple have to charge for the product with additional features to make it worthwhile to lease the machine?

• A)$55
• B)$60
• C)$71
• D)$76

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Definitions:

Market Activity

The volume of transactions or trades and the behavior of participants in financial markets, reflecting the degree of vibrancy or fluctuations.

Skimming

A pricing strategy where a company sets a high price for a product and sells to the segment that is willing to pay a premium.

Pricing Strategy

The approach businesses use to determine the best price for their products or services in order to maximize profits and market share.

High Price

A situation where goods or services are offered at a cost that is significantly above the average or expected price range.