A Product Sells for $5, and Has Unit Variable Costs

question 5

Multiple Choice

A product sells for $5, and has unit variable costs of $3. This product accounts for $20,000 in annual sales, out of the firm's total of $60,000. When performing multiproduct break-even analysis, the weighted contribution of this product is approximately

• A) 0.133
• B) 0.200
• C) 0.40
• D) 0.667
• E) $1.667

---

Definitions:

Interest Rate

The fee, represented as a percentage of the total amount lent, that a lender imposes on a borrower for the utilization of assets.

Quantity of Money Demanded

The total amount of money that households and businesses wish to hold at a given time, depending on interest rates, income levels, and economic activity.

Money Supply Curve

A graphical representation that shows the relationship between the quantity of money in the economy and the interest rate.

Interest Rate

The percentage charged on the total amount you borrow or earn on an investment over a specific period of time.