A company produces 450 units of a particular computer...

Hi AAPL,

We're told that a company produces 450 units of a particular computer component every MONTH, at a production cost to the company of $110 per component, and sells all of the components by the end of each month. We're asked for the MINIMUM selling price per component that will guarantee that the YEARLY profit (revenue from sales minus production costs) will be at least $626,400. Since we're given all of the necessary numbers to work with, the speed with which you answer this question will come down to how you choose to do the 'math.'

With 450 units produced each month, we will end up with (12)(450) = 5400 units produced each year

For the profit to be AT LEAST $626,400, we need to divide by 5400 and then add back the production cost per unit ($110 each):

626,400/5400 =
6264/54 =
$116 of profit per unit

Factoring back the original cost per unit, we have a minimum selling price of 116 + 110 = $226 per unit

Final Answer: A

GMAT assassins aren't born, they're made,
Rich