The marketing manager of Solomon Corporation has determined that a market exists for a telephone with a
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Question:
The marketing manager of Solomon Corporation has determined that a market exists for a telephone with a sales price of $24 per unit. The production manager estimates the annual fixed costs of producing between 41,000 and 80,700 telephones would be $635,400.
Required
Assume that Solomon desires to earn a $123,000 profit from the phone sales. How much can Solomon afford to spend on variable cost per unit if production and sales equal 47,400 phones?
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