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Route Two Tire Company makes a special kind of racing tire. Variable costs are $200 per unit, and fixed costs are $30,000 per month. Route
Route Two Tire Company makes a special kind of racing tire. Variable costs are $200 per unit, and fixed costs are $30,000 per month. Route Two sells 500 units per month at a sales price of $300. The company believes that it can increase the price if the tire quality is upgraded. If so, the variable cost will increase to $240 per unit, and the fixed costs will rise by 25%. The CEO wishes to increase the company's operating income by 30%. Which sales price level would give the desired results? (Round your answer to the nearest cent.)
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