Many luxury sheets cost less than $200 to make but sell for more than $500 in retail stores. Some cost even more dash consumers pay almost $3,000 for Frett'e "Tangeri Pizzo" king-size luxury linens. The creators of a new brand of luxury linens, called Boll & Branch, have entered this market. They want to price their sheets lower than most brands but still want to earn an adequate margin on sales. The sheets come in a luxurious box that can be reused to store lingerie, jewelry, or other keepsakes. The Boll & Branch brand touts fair trade practices when sourcing its high-grade long-staple organic cotton from India. Given that the cost is $145 per king-size sheet set below, and assuming the manufacturer has total fixed costs of $400,000 and estimates first year sales will be 40,000 sets, determine the price to consumers if the company desire a 50 percent margin on sales. The cost per unit is $(Round to the nearest dollar.) The markup price is $ (Round to the nearest dollar.) O A. 155; 310 O B. 310; 155 O C. 145; 310 O D. 115: 310 O E. 155; 315
Many luxury sheets cost less than $200 to make but sell for more than $500 in retail stores. Some cost even more dash consumers pay almost $3,000 for Frett'e "Tangeri Pizzo" king-size luxury linens. The creators of a new brand of luxury linens, called Boll & Branch, have entered this market. They want to price their sheets lower than most brands but still want to earn an adequate margin on sales. The sheets come in a luxurious box that can be reused to store lingerie, jewelry, or other keepsakes. The Boll & Branch brand touts fair trade practices when sourcing its high-grade long-staple organic cotton from India. Given that the cost is $145 per king-size sheet set below, and assuming the manufacturer has total fixed costs of $400,000 and estimates first year sales will be 40,000 sets, determine the price to consumers if the company desire a 50 percent margin on sales. The cost per unit is $(Round to the nearest dollar.) The markup price is $ (Round to the nearest dollar.) O A. 155; 310 O B. 310; 155 O C. 145; 310 O D. 115: 310 O E. 155; 315
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:Many luxury sheets cost less than $200 to make but sell for more than $500 in retail stores. Some cost even more dash consumers
pay almost $3,000 for Frett'e "Tangeri Pizzo" king-size luxury linens. The creators of a new brand of luxury linens, called Boll & Branch,
have entered this market. They want to price their sheets lower than most brands but still want to earn an adequate margin on sales.
The sheets come in a luxurious box that can be reused to store lingerie, jewelry, or other keepsakes. The Boll & Branch brand touts
fair trade practices when sourcing its high-grade long-staple organic cotton from India. Given that the cost is $145 per king-size sheet
set below, and assuming the manufacturer has total fixed costs of $400,000 and estimates first year sales will be 40,000 sets,
determine the price to consumers if the company desire a 50 percent margin on sales. The cost per unit is $_________ (Round to the
nearest dollar.) The markup price is $ (Round to the nearest dollar.)
O A. 155; 310
O B. 310; 155
O C. 145; 310
OD. 115: 310
O E. 155; 315
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