Hobbs Electronics makes and sells portable DVD players. Each DVD player has a selling price of $100. The following cost data per DVD player is based on a capacity of 5,000 DVD players per period. Hobbs receives a special order for 100 DVD players. The only additional costs Hobbs will incur is $2 shipping charges per item. Hobbs has sufficient idle capacity to produce the additional DVD players. What is the minimum price Hobbs should charge per DVD player for the special order? a. $60
B) $59
C) $57
D) $55
E) $62

Question

Hobbs Electronics makes and sells portable DVD players. Each DVD player has a selling price of $100. The following cost data per DVD player is based on a capacity of 5,000 DVD players per period.  Hobbs receives a special order for 100 DVD players. The only additional costs Hobbs will incur is $2 shipping charges per item. Hobbs has sufficient idle capacity to produce the additional DVD players. What is the minimum price Hobbs should charge per DVD player for the special order? a. $60
B) $59
C) $57
D) $55
E) $62

Quizplus · Accepted Answer

The Answer of Hobbs Electronics makes and sells portable DVD players. Each DVD player has a selling price of $100. The following cost data per DVD player is based on a capacity of 5,000 DVD players per period.  Hobbs receives a special order for 100 DVD players. The only additional costs Hobbs will incur is $2 shipping charges per item. Hobbs has sufficient idle capacity to produce the additional DVD players. What is the minimum price Hobbs should charge per DVD player for the special order? a. $60
B) $59
C) $57
D) $55
E) $62

Hobbs Electronics Makes and Sells Portable DVD Players