Jake Black has an opportunity to start an automobile pollution inspection busine

Question

Jake Black has an opportunity to start an automobile pollution inspection business. After extensive studies, he has developed the following set of projected annual data on which to make his decision: Black believes that his company will inspect 100,000 automobiles per year. The company earns an average of 20 percent return on its assets. Round your answers to two decimal places. Compute the projected cost for inspecting each automobile. $ 19.02 Determine the price to charge for inspecting each automobile using the gross margin pricing method. $ 22.82 Using the return on assets pricing method, compute the unit price to charge for this service.

Explanation / Answer

a) 20.02 b) 23.84 c) 27.45

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