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Company sells a product for $225 per unit. Its market share is 20%. The marketing manager feels that the market share can be increased to 30% with a reduction in price to $ 195. The product is currently earning a profit of $36 per unit. The $36 profit per unit must be maintained. Assume that the strategy is to attain a 30% market share.

1. What is the target cost per unit?

A.$225
B.$195
C.$189
D.$159

2. It is estimated that what percentage of costs are committed during the development stage of a product's life cycle?

A. 30%
B. 50%
C. 75%
D. 90% or greater

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Accounting Basics, Accounting

Category:- Accounting Basics
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