Fantasy Company is developing a new product. To be competitive, the price of the new...
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Fantasy Company is developing a new product. To be competitive, the price of the new product that Fantasy Company is developing cannot exceed $12. Fantasys required rate of return is 15% on all investments. An investment of $3,500,000 would be required to purchase the equipment needed to produce the 1,000,000 units of product that Fantasys management team thinks it can sell each year at the $12 price.
Please compute the target cost of one unit of product.
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