B. $15
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Determine the cost to produce one shirt.
The cost for manufacturing 12 shirts is $72, so the cost per shirt is:
On top of this, there is an additional cost of $3 for screen printing each shirt, making the total cost:
A 40% gross profit margin means that the profit should be 40% of the selling price.
Let's denote the selling price as S.
Then, the relationship between cost (C), profit margin (M), and selling price is given by:
where M = 40% or 0.40 in decimal form
Solving for S, we have:
which gives us
Thus, the selling price per shirt to achieve a 40% gross profit margin is $15.
