Seneca Company has invested $1,000,000 in a plant to make gas pumps for service stations. The average longrun income desired from the plant is $150,000 annually. The annual cost base for each pump is $1,000. What should be the prospective selling price for each pump if the company uses a target return on investment as the markup base?

A.

$2,500

B.

$17,000

C.

$1,150

D.

$17,500

E.

$16,000