M Studios buys cameras at a unit cost of $250. Their operating expense is 40% per unit of cost, and their desired unit operating profit is 30% of cost. What selling price should M Studios advertise for the camera?
A) $425
B) $350
C) $325
D) $320
E) $375

Question

Quizplus · Accepted Answer

The total cost per unit including the operating expense is $250 + (40% of $250) = $250 + $100 = $350. The desired profit is 30% of the cost, which is 30% of $250 = $75. Therefore, the selling price should be $350 + $75 = $425.

M Studios Buys Cameras at a Unit Cost of $250