Hitz Video Rental is evaluating rental prices

ACCOUNTING

Multiple Choice

Hitz Video Rental is evaluating rental prices. Historical data show that Friday and Saturday have twice the rentals of other days of the week. The following information pertains to the store's normal operations per week.



Average rentals per day on Friday and Saturday 1,150

Average rentals per day on Sunday through Thursday 500

Store hours per day 12

Total units available for rent 10,000



Variable operating costs per hour $ 40

Marketing costs per week $1,500

Customer service costs per week $ 250



The store manager wants to charge more for rentals on Friday and Saturday. What is the minimum price that should be charged during peak rental days?

a. $0.60

b. $0.83

c. $0.90

d. $1.06

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