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Question 6: Amazon.com wants thedog8it, a company that produces all-natural food for dogs, to produce a turkey-flavored dog biscuit as a special product for Christmas
Question 6: Amazon.com wants thedog8it, a company that produces all-natural food for dogs, to produce a turkey-flavored dog biscuit as a special product for Christmas gift-giving, provided that the retail price will come in at less than $12. If this criterion can be met, Amazon will order 6000 bags of Christmas dog treats fromthedog8it. Each eight-ounce bag of the dog treats costs 1.60 for materials and labor. The special Christmas packaging will add an additional .75 per bag. A new die to cut the Christmas treats in a star shape instead of the signature heart shape will be necessary, and this will cost $900. In addition, design of the new Christmas package will cost $850. Finally, development and testing of the new turkey recipe will cost $3800. a. thedog8it wants a 65% margin on cost. What price will the company charge Amazon.com? b. Amazon.com typically expects a 40% mark-up on selling price. What retail price does that yield?
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