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Rica Company Is a Price-Taker and Uses Target Pricing

Question 129

Multiple Choice

Rica Company is a price-taker and uses target pricing. Refer to the following information: Rica Company is a price-taker and uses target pricing. Refer to the following information: With the current cost structure, Rica cannot achieve its profit goals. It will have to reduce either the fixed costs or the variable costs. Assuming that variable costs cannot be reduced, how much will be the target fixed costs per year? A) $5,115,000 B) $5,600,000 C) $10,315,000 D) $5,200,000 With the current cost structure, Rica cannot achieve its profit goals. It will have to reduce either the fixed costs or the variable costs. Assuming that variable costs cannot be reduced, how much will be the target fixed costs per year?


A) $5,115,000
B) $5,600,000
C) $10,315,000
D) $5,200,000

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