Question

Ortega company manufactures computer hard drives. the market for hard drives is very competitive. the current market price for a computer hard drive is $66. ortega would like a profit of $6 per drive. what target cost ortega should set to accomplish this objective?

Answer 1

To calculate for the amount that the Ortega company should sell their computer hard drives, we have to sum up or add up the market price and the profit they want. The total is equivalent to $72. Although selling at this price will guarantee them the desirable profit per piece, it is to be noted that the market is in tight competition so they may opt to lower down the price.