A manufacturer of AC units realizes a cost of $55.00 for every unit produced. Its total fixed cost is $2,000,000. If the manufacturer produces 500,000 units, calculate its:

a. unit cost
b. markup price if it desires a 10% returns on sales
c. ROI price if it desires a 25% return on investment of $1 million

To calculate the different values, we need to understand a few concepts. Let's break it down step by step:

a. Unit Cost:
The unit cost is calculated by taking the total cost and dividing it by the number of units produced. In this case, the total cost consists of both the fixed cost and the cost per unit.

Total Cost = Fixed Cost + (Cost per Unit * Number of Units)

Given:
Cost per Unit = $55.00
Number of Units = 500,000
Fixed Cost = $2,000,000

Plugging in the values:
Total Cost = $2,000,000 + ($55.00 * 500,000)

Calculating:
Total Cost = $2,000,000 + $27,500,000
Total Cost = $29,500,000

Unit Cost = Total Cost / Number of Units
Unit Cost = $29,500,000 / 500,000
Unit Cost = $59.00

Therefore, the unit cost of each AC unit is $59.00.

b. Markup Price:
If the manufacturer desires a 10% return on sales, we need to calculate the markup price.

Markup Price = Unit Cost + (Unit Cost * Markup Percentage)

Given:
Unit Cost = $59.00
Markup Percentage = 10%

Plugging in the values:
Markup Price = $59.00 + ($59.00 * 0.10)

Calculating:
Markup Price = $59.00 + $5.90
Markup Price = $64.90

Therefore, the markup price per unit, if the manufacturer desires a 10% return on sales, is $64.90.

c. ROI Price:
If the manufacturer desires a 25% return on its investment of $1 million, we need to calculate the ROI price.

ROI Price = Total Investment + (Total Investment * ROI Percentage)

Given:
Total Investment = $1,000,000
ROI Percentage = 25%

Plugging in the values:
ROI Price = $1,000,000 + ($1,000,000 * 0.25)

Calculating:
ROI Price = $1,000,000 + $250,000
ROI Price = $1,250,000

Therefore, the ROI price, if the manufacturer desires a 25% return on its investment of $1 million, is $1,250,000.