Timax Company,a Manufacturer of Moderately Priced Time Pieces,would Like to Introduce

Multiple Choice

Timax Company,a manufacturer of moderately priced time pieces,would like to introduce a new electronic watch into the market.To compete effectively,the watch could not be priced at more than $50.The company requires a return on investment of 25% on all new products.The plan is to produce and sell 20,000 watches each year.This would require a $500,000 investment.What would be the target cost per watch?

A) $25.00.
B) $39.00.
C) $43.75.
D) $64.00.