Princeton avionics makes aircraft instrumentation. Its basic navigation radio requires $60 in variable costs and $ 4,000
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Princeton avionics makes aircraft instrumentation. Its basic navigation radio requires $60 in variable costs and $ 4,000 per month in fixed costs. Princeton sells 20 radios per month. If the company future processes the radio, to enhance its functionality, it will require and additional $40 per unit of variable costs, plus an increases in fixed costs of $500 per month. The current sales price of the radio is $280. The CEO wishes to improve operating income by $1,200 per month by selling the enhanced version of the radio. In order to meet this target, the sales price to be changed for the enhanced product is --------
Select one:
a. $320 per unit
b. $380 per unit
c. $125 per unit
d. $405 per unit
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