Refer to Scenario 9

question 95

Multiple Choice

Refer to Scenario 9.9 below to answer the question(s) that follow.
SCENARIO 9.9: Sponsors invest $250,000 in a new greeting card business on the promise that they will earn a return of 10% per year on their investment. The business sells 52,000 greeting cards per year. The fixed costs for the business include the return to investors and $79,000 in other fixed costs. Variable costs consist of wages ($1,000 per week) plus materials, electricity, etc. ($3,000 per week) . The business is open 52 weeks per year.
-Refer to Scenario 9.9. The business is earning exactly a normal profit. Thus, the average price per greeting card must be

• A) $1.52.
• B) $2.
• C) $4.
• D) $6.

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Definitions:

Nonprogrammed Decision-making

The process of making decisions in response to unique, novel, or ill-structured situations that require creativity and judgment.

Product Innovation

The creation and introduction of new or significantly improved goods or services in the market.

Process Innovation

The implementation of a new or significantly improved production or delivery method, enhancing efficiency or quality.

Organizational Cultural Lag

The delay between changes in organizational culture and the adaptation of its strategies, processes, or structure.