Total cost used to determine the price
Problem: A company has $50 per unit in variable costs and $1,200,000 per year in fixed costs. Demand is estimated to be 110,000 units annually. What is the price if a markup of 40% on total cost is used to determine the price?
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A company has $50 per unit in variable costs and $1,200,000 per year in fixed costs. Demand is estimated to be 110,000 units annually. What is the price if a markup of 40% on total cost is used to determine the price?
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