$.$

Nature's House'sNature's$$House$\text{'}$s

owners want to earn

aa

$1212\%$

return on the$$ company's assets. What is

Nature's House'sNature's$$House$\text{'}$s

target full$$ cost$?$

$2.$

Given

Nature's House'sNature's$$House$\text{'}$s

current$$ costs, will its owners be able to achieve their target$$ profit? Show your analysis.

$3.$

Assume that

Nature's HouseNature's$$House

has identified ways to cut its variable costs to

$ $1\mathrm{.}10$$$1\mathrm{.}10$

per unit. What is its new target fixed$$ cost$?$ Will this decrease in variable costs allow the company to achieve its target$$ profit? Show your analysis.

$4.$

Nature's HouseNature's$$House

started an aggressive advertising campaign strategy to differentiate its plants from those grown by other nurseries.

Nature's HouseNature's$$House

$$doesn$\text{'}$t expect volume to be$$ affected, but it hopes to gain more control over pricing. If

Nature's HouseNature's$$House

has to spend

$ $100$ comma $000$$$100,000$

this year to advertise and its variable costs continue to be

$ $1\mathrm{.}10$$$1\mathrm{.}10$

per$$ unit, what will its$$ cost$-$plus price$$ be$?$ Do you think

Nature's HouseNature's$$House

will be able to sell its plants to garden centers at the$$ cost$-$plus price? Why or why$$ not?