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Question(s) / Instruction(s):

A custom tailor wishes to use target profit pricing to establish a price for a custom designed business suit. Assume variable cost is $200 per suit, fixed cost is $44,000, and a target profit of $50,000 on a volume of 50 suits is desired? What price should be charged for a typical custom suit?
A.    $1,040
B.    $900
C.    $1,800
D.    $2,080
E.    cannot be determined from the information provided

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