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Sno Delight operates a Rocky Mountain ski esort. The company is planning its ticket pncing forthe o mng ski season. Investors would like to earn
Sno Delight operates a Rocky Mountain ski esort. The company is planning its ticket pncing forthe o mng ski season. Investors would like to earn a 10% return on investment on the company's $260 900 000 o assets eco a y primarily incurs fixed costs to groom the runs and operate the lifts. SnowDelight projects fixed costs to be $30,000,000 for the ski season. The resort serves about 710,000 skiers and snowboarders each season. Variable costs are about S9 per guest. Currently, the resort has such a favorable reputation among skiers and snowboarders that it has some control over the lift ticket prices. Read the requirements Requirement 1. Would SnowDelight emphasize target pricing or cost-plus pricing? Why? SnowDelight should emhasize a need to consider whether the I I price is within the range customers are willing to pay. Requirement 2. If other resorts in the area charge $83 per day, what price should SnowDelight charge? Complete the following table to calculate the price SnowDelight should charge per lift ticket. approach to pricing because it has been able to differentiate its s so m others in the area. Because o its good eputation managers will have control over pricing Of course, they stil Plus: Plus: Divided by Price per lift ticket Given SnowDelight's favorable reputation, they should be able to charge the price above without affecting their volume. won't be able to charge the price above without affecting their volume
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