Snow Lovers operates a Rocky Mountain ski resort. The company is planning its lift-ticket pricing for the coming ski season. Investors would like to earn a 19% return on the company's $125 million of assets. The company incurs primarily fixed costs to groom the runs and operate the lifts. Snow Lovers projects fixed costs to be $34,750,000 for the ski season. The resort serves about 750,000 skiers and snowboarders each season. Variable costs are about $10.50 per guest. Currently, the resort has such a favourable reputation among skiers and snowboarders that it has some control over the lift-ticket prices.

1.	Would Snow Lovers emphasize target costing or cost-plus pricing? Why?
2.	If other resorts in the area charge $85 per day, what price should Snow Lovers charge?

1. Would Snow Lovers emphasize target costing or cost-plus pricing? Why? Snow Lovers should emphasize a approach to pricing because it has been able to differentiate its ski resort from others in the area. Because of its favourable reputation, managers will have course, they still need to consider whether the price is within the range customers are willing to pay. control over pricing. Of 2. If other resorts in the area charge $85 per day, what price should Snow Lovers charge? Complete the following table to calculate the price Snow Lovers should charge. (Round your final answer to the nearest dollar.) Plus: Plus: Target revenue Divided by: Price per lift ticket If other resorts in the area charge $85 per day, what price should Snow Lovers charge? The price is $ competing ski resorts in the area. Given Snow Lovers' favourable reputation, it