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need answers for requirements 2-3 Smith Builders builds 1,500-square-foot starter tract homes in the fast-growing suburbs of Hartford. Land and variable cost of each home
need answers for requirements 2-3 Smith Builders builds 1,500-square-foot starter tract homes in the fast-growing suburbs of Hartford. Land and variable cost of each home sale. Similar homes offered labor are cheap, and competition among developers is by competing builders sell for $206,000 each fierce. The homes are "cookie-cutter, with any upgrades added by the buyer after the sale. Smith Builders' cost per developed sublot are as follows Smith Builders would like to earn a profit of 15% of the orrect: o Read the requirements E8-23A EEB (Click the icon to view the costs.) h Builders builds 1,500-square-foot starter tract homes in the fast growing suburbs of Hartford Land and labor are cheap, and competition among developers Smith Builders rce. The homes are"cookie-cutter," with any upgrades added by the buyer after the sale. Smith Builders' cost per developed sublot are as follows (Click the icon to view the costs.) Read the requ quirement 1. Which approach to pricing should Smith Builders emphasize? Why? ith will need to emphasize a target costing approach to pricing Because the tract homes are not unique and face stif competition, Smith will not have much control over quirement 2. wil Smith Builders be able to achieve its target profit levels? Show your computations omplete the following table to show whether Smith Builders will be able to achieve their target proft levels. (Use parentheses or a minus sign to indicate a profit shortfial) Requirements ess Target cost per home 1. Which approach to priing should Smith Builders emphasize? Why? ess 2. Will Smith Builders be able to achieve its target proft levels? Show your computations 3. Bathrooms and kitchens are typically the most important selling features of a home. Smith Builders could differentiate the homes by upgrading bathrooms and kitchens The upgrades would cost $18,000 per home but would enable the company to increase the selling prices by $31.500 per home (in general kitchen and bathroom upgrades typicaly add at least 150% of their 1 cost to the value of any home ) If Smith Builders upgrades, what will the new cost-plus price per home be? Should the company differentiate its product in this manner? Show your analysis Expected excess profit (profit shortfial) Data Table s 51,000 Land $ 128,000 Print Done $ 5,000 5 1,000 Variable marketing costs Pint Done Choose from any list or enter any number in the input fiekds and then click Check Answer Clear All
need answers for requirements 2-3
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