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Jemima's Casuals sells high-class ladies outfits. It has an outlet in Dixie Value Mall. Its marketing policy is to sell every outfit for a fixed
Jemima's Casuals sells high-class ladies outfits. It has an outlet in Dixie Value Mall. Its marketing policy is to sell every outfit for a fixed price of $75. The normal mark-up is 50% of cost, so selling price is 150% of cost. The fixed costs consist of rent, salaries, etc. and are $5,000 per month. Jemima's Casuals is considering raising the price from $75 per outfit to $90 per outfit. It is currently selling 500 outfits per month. The price increase would cause volume to drop by 10%. Jemima's Casuals should increase the price because operating profit will increase by $3,000 O b. increase the price because operating profit will increase by $5,500 C. increase the price because operating profit will increase by $5,000 O d. none of the above e. not increase the price because operating profit will be reduced
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