Bakersfield Manufacturing Produces Agricultural Tools Including a Hand Tiller

Multiple Choice

Bakersfield Manufacturing produces agricultural tools including a hand tiller. Their current full-product cost for a hand tiller is $20. Bakersfield wishes to make a 15% profit on the selling price. Bakersfield uses a target pricing strategy. The current competitive market price for this product is $22.00. What would be the most appropriate response to this situation?

A) Employ cost plus pricing.
B) Carry out value engineering study.
C) Expand production facilities.
D) Strengthen internal controls.