Solution-How much is the cost gap that needs to be removed

How much is the cost gap that needs to be removed to meet

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Question 1: Killer Drinks produces smoothies and other juice drinks for less health conscious individuals. Its managers are considering a new juicer that will extract the unneeded parts of pomegranates to create new drinks. Killer Drinks believes it may be able to sell 2,000 of the new product at an average price of $4.00 per drink. Management specifies a target profit margin of 20% return on sales. If the product's current cost is $3.38 per unit, how much is the cost gap that needs to be removed to meet the target profit margin?

Group of answer choices

1) $0.18 per unit

2) $0.68 per unit

3) $0.62 per unit

4) $0.80 per unit

Reference no: EM132502706

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How much is the cost gap that needs to be removed to meet

Reference no: EM132502706

Reference no: EM132502706

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