Action Toys Has a New Video Game Cassette for the Upcoming

question 178

Multiple Choice

Action Toys has a new video game cassette for the upcoming holiday season.It is trying to determine the target cost for the game if the selling price per unit will be set at $60,the going price for video games,and the firm wants to earn a target operating income of 15% of sales.What will be the target cost per unit for the new game?

• A) $60
• B) $51
• C) $27
• D) $9

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Definitions:

Tax Cuts

Reductions in the amount of taxes that individuals or corporations are required to pay to the government.

Government's Plan

A systematic arrangement of actions or strategies designed by a government to achieve specific outcomes or objectives.

Softening Economy

A term used to describe an economic state where growth is slowing down, signaling a potential downturn or lesser economic activity.

Government Spending Multiplier

A coefficient that measures the change in total income resulting from a unit change in government spending.