Straus Company, a Manufacturer of Electronic Products, Wants to Introduce

question 60

Multiple Choice

Straus Company, a manufacturer of electronic products, wants to introduce a new calculator. To compete effectively, the calculator could not be priced at more than $40. The company requires a 20% rate of return on investment on all new products. In order to produce and sell 30,000 calculators each year, the company would have to make an investment of $850,000. The target cost per calculator would be:

• A) $16.50
• B) $23.50
• C) $28.33
• D) $34.33