Timdat Corporation, a Manufacturer of Moderate-Priced Time Pieces, Would Like

Multiple Choice

Timdat Corporation, a manufacturer of moderate-priced time pieces, would like to introduce a new electronic watch. To compete effectively, the watch could not be priced at more than $30. The company requires a return on investment of 25% on all new products. The plan is to produce and sell 40,000 watches each year. This would require a $600,000 investment. The target cost per watch would be:

A) $10.00
B) $20.00
C) $26.25
D) $45.00