Question

PH Toy Company is unsure of whether to sell its product assembled or unassembled. The unit cost of the unassembled product is $30 and PH Toy would sell it for $65. The cost to assemble the product is estimated at $21 per unit and the company believes the market would support a price of $85 on the assembled unit. What decision should PH Toy make?

Answer 1

Brainliest please? :)

PH Toy Company should sell its product unassembled.

The cost of the unassembled product is $30 and they would mark it up to $65 retail price resulting in a gross profit of $35

The cost to assemble the product is $21 per unit bringing the assembled product's total cost to $51. They would then mark it up to $85 retail price resulting in a gross profit of $34

Due to the unassembled product's retail price being cheaper, it would pertain to a different demographic that isn't as likely to spend more money on products.