5. Yoplait has new line of Greek yogurt in a 9 oz size. The Marketing Managers p

Question

5. Yoplait has new line of Greek yogurt in a 9 oz size. The Marketing Managers plan to test market the product in one small market for three weeks.     They has calculated the cost and projected sales for each of the different flavors: Plain cost is .55 each with a projected sales of 10,000 units, Strawberry cost per unit is .60 with a projected sales of 13,000 units, Blueberry cost are .68 per unit with a projected sales of 9,000 units. Each yogurt product will retail at the same price. Using the average cost pricing and a 35% markup what will Yoplait price these product at the retail level ______________ 10 pts.Show your calculations for each problem.   If I do not see the calculations, then I will not give credit. These can be typed on this form.

Explanation / Answer

Average cost for plain=0.55 (no. of units is 10000)

Average cost for strawberry=0.60 (no. of units is 13000)

Average cost for blueberry=0.68 (no. of units is 9000)

Since every product will be retailed at the same price, average cost will be the total average cost of the three products which can be calculated as

Average cost =(0.55*10000+0.60*13000+0.68*9000) / (10000+13000+9000)

Average cost= 19420/32000 = 0.606875

hence average cost will be 0.606875 by adding 35% marke up of 0.2124

Selling price = 0.606875+0.2124 = 0.819275

That is Yoplait price these products at the retail level with 0.82

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