Victor's Detailing Customers Would Be Willing to Pay $57 Per

question 111

Multiple Choice

Victor's Detailing customers would be willing to pay $57 per detail. The average job would cost $30.
-Refer to the Figure.Assume Victor's Detailing uses target costing to set price on each job.The company requires a 40% profit on each job.What price should Victor's Detailing quote to a new customer?

• A)$24
• B)$30
• C)$54
• D)$57

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Definitions:

Marginal Product

The increase in output that results from employing one more unit of a particular input, holding all other inputs constant.

Average Total Cost

The total cost of production divided by the quantity of output produced. It includes both fixed and variable costs.

Marginal Product

Marginal Product is the additional output that results from using one more unit of a particular input, holding other inputs constant.

Average Product

The output per unit of input, typically calculated by dividing total output by the quantity of a specific input used.