Question
120 units of semi-conductors are required to be sold to
earn a profit of Rs.1,00,000 in a monopoly market. The fixed cost for the period is Rs.80,000. The contribution in the monopoly market is as high as 3/4th of its variable cost. Determine the target selling price per unit.Solution
Contribution = ₹(1,00,000 + 80,000) = ₹1,80,000 Contribution/Unit = ₹(180000 ÷ 120) = ₹1500 Variable cost/unit = 1500 ÷ ¾ = ₹2000 Selling price = ₹1,500 + ₹2,000 = ₹3,500
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