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please answer all three and write answer numbers in front of them LO3 Cost-based Pricing E7. Hometown Bank is determining the price for its newest

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LO3 Cost-based Pricing E7. Hometown Bank is determining the price for its newest mini debit card. The card can be used at any retail outlet with a swipe reader and is small enough to attach to a key chain-no PIN number or signature is required. Sigrid Olmo has developed the following annual information for use in upcoming price determi- nation meetings: Variable processing costs $50 million Fixed processing costs 36 million Selling expenses (fixed) 10 million General and administrative expenses (fixed) 4 million Desired profit 3 billion Cost of assets employed 10 billion Annual usage is expected to be 10 billion transactions. On average, the company now earns a 6 percent return on assets. 1. Compute the projected cost of one transaction. 2. Using gross margin pricing, compute the price to charge per transaction. 3. Using return on assets pricing, compute the price to charge per transaction

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