Company sales are currently 100,000 What is the target cost if the company wants to maintain its same income level, and marketing is correct (rounded to the nearest cent)? 0004.00
Company sales are currently 100,000 What is the target cost if the company wants to maintain its same income level, and marketing is correct (rounded to the nearest cent)? 0004.00
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
![11) Istanbul Company currently sells cellphones for $500. It has costs of $320. A competitor is bringing a new cell phone to
market that will sell for $430. Management believes it must lower the price to $430 to compete in the market for cell phones.
Marketing believes that the new price will cause sales to increase by 10%, even with a new competitor in the market. Istanbul
Company sales are currently 100,000 cell phones per year.
What is the target cost if the company wants to maintain its same income level, and marketing is correct (rounded to the nearest
cent)?
A) $224.00
B) $238.18
C) $266.38
D) $290.00
E) $311.00](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F36c5c9d7-9e37-4923-b8cd-fba646312507%2Fc85aa85b-114a-4115-9f6f-99ad299989eb%2F939fr6_processed.jpeg&w=3840&q=75)
Transcribed Image Text:11) Istanbul Company currently sells cellphones for $500. It has costs of $320. A competitor is bringing a new cell phone to
market that will sell for $430. Management believes it must lower the price to $430 to compete in the market for cell phones.
Marketing believes that the new price will cause sales to increase by 10%, even with a new competitor in the market. Istanbul
Company sales are currently 100,000 cell phones per year.
What is the target cost if the company wants to maintain its same income level, and marketing is correct (rounded to the nearest
cent)?
A) $224.00
B) $238.18
C) $266.38
D) $290.00
E) $311.00
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