Steinbarr Builders builds 1,500-square-foot starter tract homes in the fast-growing suburbs of Atlanta. Land and labor are cheap, and competition among developers is fierce. The homes are a standard model, with any upgrades added by the buyer after the sale. Steinbarr Builders' costs per developed sublot are as follows: Steinbarr Builders would like to earn a profit of 14% of the variable cost of each home sold. Similar homes offered by competing builders sell for $203,000 each. Assume the company has no fixed costs. (Click the icon to view the costs.) Read the requirements. Requirement 1. Which approach to pricing should Steinbarr Builders emphasize? Why? Steinbarr Builders will need to emphasize a target-costing approach to pricing because they are price-takers. This means Steinbarr will not have much control over pricing because the tract homes are not unique and face stiff competition. Requirement 2. Will Steinbarr Builders be able to achieve its target profit levels? - Begin by calculating the target cost. Market price of similiar homes Less: Desired profit Target full cost per home Help me solve this Etext pages Get more help Requirements 1. Which approach to pricing should Steinbarr Builders emphasize? Why? 2. Will Steinbarr Builders be able to achieve its target profit levels? 3. Bathrooms and kitchens are typically the most important selling features of a home. Steinbarr Builders could differentiate the homes by upgrading the bathrooms and kitchens. The upgrades would cost $28,000 per home but would enable Steinbarr Builders to increase the sales prices by $49,000 per home. (Kitchen and bathroom upgrades typically add about 175% of their cost to the value of any home.) If Steinbarr Builders makes the upgrades, what will the new cost-plus price per home be? Should the company differentiate its product in this manner? er