A Company with Fixed Costs of $200,000 Per Month Believes

Multiple Choice

A company with fixed costs of $200,000 per month believes that they have this holiday season's hot selling item, a towel that folds itself into a variety of shapes so you can turn your own home into a cruise ship cabin. They believe they can sell 100,000 units and need to determine a minimum price that will cover their fixed and variable costs, with the latter being $45 per unit.

A) $45.20
B) $46.50
C) $46.80
D) $47.00