Class: Principles of marketing

- Solve the pricing value problems below BY HAND on a separate sheet of paper. - Calculate the problems based on the equations you learned from the textbook. - CIRCLE YOUR FINAL ANSWER. - You must show your full work HAND-WRITTEN to receive full credit. Do not type your answers. - Scan and upload your assignment by the due date. PROBLEMS: 1. Captain A is a fashion house that designs, manufactures, and sells shields. Their lowest-selling design is a red, white, and blue striped shield. Captain A is considering lowering the selling price of the shield to stimulate demand. However, before lowering the price, they must evaluate the total costs associated with creating the shield. - Metal and other materials - \$62/shield - Labor to construct the shield - $40/ shield - Equipment cost to create all shields - \$3,000 Captain A anticipates selling 500 shield after lowering the selling price. Assuming their projection is accurate, what is the total average cost they will incur per shield? 2. Peter Parker wants to open a science lab for high school teachers. He estimates that the fixed costs associated with opening his lab are $40,000. He expects the lab to book 260 sessions in the first year, each of which will cost him $50 to service. He estimates the lab will generate $91,000 in revenue. For Peter, the total cost of opening his science lab and staying in business for one year will be: 3. Magneto's Mutants sells a magnet kit for \$22. The kit is mainly used to creating robots for high school robotics clubs. The average variable cost for each magnet kit is $13, and the total annual fixed cost for plant operation is $78,300. What is the break-even point in units? 4. Stark Industries is developing a new cell phone that can fit in a ring. The fixed costs for manufacturing are $10,0000 and each cell phone has a variable cost of $20. Stark Industries plans to offer the new cell phones at $60. How many cell phones does Stark Industries need to sell to reach the break-even point? 5. Stark Industries wants to offer a free tour of its premises and wants to make their building more appealing. They decide to open a cookie shop on the ground-floor. The total annual fixed cost for the cookie shop will be $25,000, and the variable cost per each cookie sold is $2,00. If the sales price per cookie is $6.00, what is the break-even point in units