Golden Orchard Farms is considering pricing adjustments for its fresh-squeezed pear juice in half-gallon containers. Variable...
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Golden Orchard Farms is considering pricing adjustments for its fresh-squeezed pear juice in half-gallon containers. Variable costs are $1.60 per container. The management is evaluating prices between $2.60 and $3.10 to find the optimal price point that maximizes contribution margin. Prepare a detailed cost-benefit analysis.
Price per Half Gallon | Estimated Demand (Half-Gallon Units) |
$2.60 | 95,000 |
$2.65 | 92,500 |
$2.70 | 90,000 |
$2.75 | 87,500 |
$2.80 | 85,000 |
$2.85 | 82,500 |
$2.90 | 80,000 |
$2.95 | 77,500 |
$3.00 | 75,000 |
$3.05 | 72,500 |
$3.10 | 70,000 |
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