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?
2. It is estimated that what percentage of costs are committed during the development stage of a product's life cycle?
D. 90% or greater