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19 May, 05:34

Ortega Company manufactures computer hard drives. The market for hard drives is very competitive. The current market price for a computer hard drive is $45. Ortega would like a profit of $10 per drive. What target cost Ortega should set to accomplish this objective

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  1. 19 May, 05:35
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    Ortega should set a target cost of $35

    Explanation:

    Target cost is the competitive market price of a product minus the desired profit margin.

    Competitive market price in this case is $45

    Desired profit margin is $10

    Target cost=competitive market price-desired profit amount

    target cost=$45-$10=$35

    Target cost for which the company must produce the hard drive in order to sell at $45 per drive and make a profit of $10 per drive is $35
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Home » Business » Ortega Company manufactures computer hard drives. The market for hard drives is very competitive. The current market price for a computer hard drive is $45. Ortega would like a profit of $10 per drive.
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