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Memphis Electrical makes small electric motors. The market research department indicates that a small motor for garage door openers would sell for $49. A similar

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Memphis Electrical makes small electric motors. The market research department indicates that a small motor for garage door openers would sell for $49. A similar motor currently produced has the following costs: The company wants a gross margin of 25% of the manufacturing costs. Suppose Memphis used cost-plus pricing, setting the price 25% above manufacturing costs. What price would be charged for the motor? Would you produce such a motor? Suppose Memphis used target costing. What is the highest acceptable manufacturing cost for which Memphis would be willing to produce the motor

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