3. Computer Monitors, Inc., currently sells 17 monitors for $270. It has costs of $210. A competitor is bringing a new 17 monitor to market that will sell for $225. Management believes it must lower the price to $225 to compete in the market for 17 monitors. Marketing believes that the new price will cause sales to increase by 10%, even with a new competitor in the market. Computer Monitor, Inc.s sales are currently 10,000 monitors per year. What is the target cost if target profit is 25% of sales (rounded to the nearest cent)?

1. $56.25
2. $67.50
3. $168.75
4. $202.50

4. Using the information in Question #3 above, what is the target selling price if costs cannot be reduced and target profit is changed to 20% of sales (rounded to the nearest cent)?

a. $252.00

b. $262.50

c. $265.00

d. $270.00