Sarah’s Scarves is introducing an all-wool Christmas scarf. Research indicates t

Question

Sarah’s Scarves is introducing an all-wool Christmas scarf. Research indicates that 65,000 scarves can be sold at $20. Sarah’s desired profit is $0.75 per scarf, which represents a 24% rate of return. Sarah’s would like to determine the target cost per scarf. Which two pieces of information are needed to make this determination and how should they be used?

A : The market price should be divided by the number of scarves sold.

B : The desired profit should be added to the number of scarves sold.

C : The desired profit should be subtracted from the market price.

D : The desired profit should be multiplied by the rate of return.

Explanation / Answer

Answer C

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