Clear Blue Pools builds custom in-ground pools ranging in price from $18,000 to $36,000. Dr. Jim Hardin, a local plastic surgeon has asked Clear Blue Pools to show him a portfolio of pools. Dr. Hardin has selected a model that calls for materials of $18,000, and labor and overhead of $13,000, but Dr. Hardin wants some handicap features not included in the model that would add another $4,000 to the cost but does not want to pay more than $32,000. Clear Blue Pools typically prices its pools based on the total cost of construction plus 15%.
Required:
| a. | What price would Clear Blue Pools normally quote for this pool? |
| b. | What is the target cost Clear Blue Pools would need to meet to sell the pool for |
$32,000
at a 15% markup? (Round to the nearest dollar)
| c. | What could Clear Blue Pools do to meet the target cost in part b? |
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