Your firm designs training materials for computer training classes, and you have just received a request to bid on a contract to produce a complete set of training manuals for an 8-session class. From previous experience, you know that your firm follows an 80% learning rate. For this contract, it appears that the effort will be substantial, running 300 hours for the first session. Your firm has an average cost of labor of $80/hour and the overhead is expected to run a fixed $1200 per session. The customer will pay you a flat fixed rate per session (Per Session Price.) If your profit markup is 10%, what will be the Total Price, the Per Session Price, and at what session will you break even?

Answer the following four questions:

1. What is the Total Price? This is what you would charge the customer so that you can have your profit markup of 10% over all of your costs. To calculate this, first figure out your cost per each session, add them up, and then add your profit.
2. What is the Per Session Price? This is the revenue that the customer pays you each time you complete a session. It is calculated by dividing the Total Price by the number of sessions.