Gildea Builders builds $1,500-$square$-$foot starter tract homes in the fast$-$growing suburbs of Boston. Land and labor are inexpensive, and competition among developers is fierce. The homes are "cookie$-$cutter," with any upgrades added by the buyer after the sale. Gildea Builders' costs per developed sublot are as follows:

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Gildea Builders would like to earn a profit of $14\%$ of the variable cost of each home sale. Similar homes offered by competing builders sell for $$209,000$ each.

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Requirement $1.$ Which approach to pricing should Gildea Builders emphasize? Why?

Gildea will need to emphasize a $$ approach to pricing. Because the tract homes are $$ stiff competition, Gildea will control over pricing.