Question: 5. During 2008, Thor Lab supplied hospitals with a comprehensive diagnostic kit for $120. At a volume of 80,000 kits, Thor had fixed costs of

5. During 2008, Thor Lab supplied hospitals with a comprehensive diagnostic kit for $120. At a volume of 80,000 kits, Thor had fixed costs of $1,000,000 and a profit before income taxes of $200,000. Due to an adverse legal decision, Thor’s 2009 liability insurance increased by $1,200,000 over 2008. Assuming the volume and other costs are unchanged, what should the 2009 price be if Thor is to make the same

$200,000 profit before income taxes?

a. $120.00

b. $135.00

c. $150.00

d. $240.00

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