A Small Computer Manufacturer Wants to Price Its Product to Earn

question 150

Essay

A small computer manufacturer wants to price its product to earn a return of 60% on equity before interest and taxes. The computer has technological advantages that make management certain they can sell the firm's maximum production of 60,000 units per year at any reasonable price. The variable cost to build and sell a computer is $800, fixed costs are $5,500,000 per year and the firm has $9,000,000 in its equity account.

---

Definitions:

Memory Errors

Mistakes or inaccuracies in the process of encoding, storing, or retrieving memories, which can lead to false recollections or forgetting.

Humanistic

Humanistic refers to a psychological perspective that emphasizes the study of the whole person, looking at human behavior not only through the eyes of the observer but also through the eyes of the individual experiencing it.

Behavioral

Related to or based on observable actions or responses in organisms, often studied in psychology and sociology.

Gestalt Psychology

A theory of mind and brain positing that the operational principle of the brain is holistic, parallel, and analog, with self-organizing tendencies; or, the idea that the whole is greater than the sum of its parts.