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Author Question: Toy City Inc., manufactures a product and is considering raising the price by $40 a unit for the ... (Read 20 times)

2125004343

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Toy City Inc., manufactures a product and is considering raising the price by $40 a unit for the coming year. With a $40 price increase, demand is expected to fall by 2800 units.

CurrentlyProjected
Demand23,000 units20,200 units
Selling price$160$200
Variable costs per unit$100$100

Bright Inc., has a capacity to produce 28,800 units. Due to an increase in the electricity costs, there is a sudden spike in demand by 2800 units. If the company adopts peak-load pricing policy and charges a premium of 20% over the current sales price, what is the total contribution on the sale of additional units?
◦ $257,600
◦ $280,000
◦ $537,600
◦ $526,400


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Marked as best answer by 2125004343 on Mar 6, 2021

juwms

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2125004343

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Reply 2 on: Mar 6, 2021
YES! Correct, THANKS for helping me on my review


Jsherida

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Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

 

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