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Alex is the manager of a division of a paper firm that produces copier paper and sells it on the wholesale market. His firm's output represents about 1.5% of total copier paper sales. The wholesale price of copier paper is $3.95 per standard package. His plant engineers report that, at his projected volume, labor costs are $1.00 per package, material costs are $2.00 per package, and other average fixed costs are about $0.75. What price should he charge for his firms product?
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