The food division managers would like assistance developing a pricing strategy for the new line of dog treats, the manager is looking at pricing strategy for each stage of the product life cycle $($information on dog food products is found below$).$

The selling price and cost information for each box of dog food $(12$ cans$)$ is as follows:

Selling price $$22\mathrm{.}50$

Costs

$$ Direct materials $ $6\mathrm{.}25$

$$ Direct labour $(0\mathrm{.}5$ hours x $$15\mathrm{.}00)$ $$7\mathrm{.}50$

$$ Overhead $(0\mathrm{.}25$ machine hours $\backslash$times $$10)$ $$2\mathrm{.}50$

Dog Treats

The food division has recently released plans to manufacture a new line of CBD dog treats, Downward Dog. They are designed to help pups with stress levels, pain and inflammatory response, joint mobility and skin conditions.

The target customers for Downward Dog$$s are:

$$ Owners of dogs with health and wellness concerns

$$ Interested in the novelty factor of the treats

$$ Regular Munchie$$s customers who purchase Downward Dogs out of interest in the new product

There is growing competition in the CBD pet food and treat market and Munchies is keen to bring Downward Dogs to market no later than July $1,2024.$ While the food division is currently in the product development phase, they have signalled that the target market date of July $1,2024,$ is feasible.