Use the Information Below to Answer the Following Question(s)

question 43

Multiple Choice

Use the information below to answer the following question(s) .Acorn Products currently sells small boats for $360.It has costs currently assigned to it of $280.A competitor is bringing a new small boat to market that will sell for $300.Management believes it must lower the price to $300 to compete in the market for small boats.Marketing believes that the new price will cause sales to increase by 10 percent, even with a new competitor in the market.Acorn's sales are currently 100,000 per year.
-Under cost-plus pricing, what is the required selling price to achieve a 15% markup?

• A)$285
• B)$6300
• C)$310
• D)$315
• E)$322

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Definitions:

Upward Sloping

refers to a graph line that shows an increase in one variable as another variable increases, commonly seen in supply curves.

Budget Constraint

An economic model that represents all the combinations of goods and services a consumer can afford given their income and prices.

Opportunity Cost

The value of the best alternative forgone as a result of choosing a particular action or decision.

Pineapples

A tropical fruit with a tough outer shell, sweet and juicy interior, and an ability to thrive in warm climates.