Plymouth Corp

question 113

Multiple Choice

Plymouth Corp.sells units for $100 each.Variable costs are $75 per unit,and fixed costs are $200,000.If Plymouth leases a new machine,fixed costs will increase by $60,000 a year,but production will be more efficient,saving $5 per unit.At what level of production will Plymouth be indifferent between leasing and not leasing the new machine?

• A)5,000
• B)10,000
• C)10,400
• D)12,000

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Definitions:

GDP

Gross Domestic Product, a measure of a country's economic performance, representing the total value of all goods and services produced over a specific time period.

Foreign Corrupt Practices Act

A United States law aimed at preventing American companies from engaging in bribery and other unethical practices in foreign countries to obtain or retain business.

Facilitation Payments

These are small sums of money paid to expedite or secure the performance of routine governmental actions by officials, often viewed as a form of bribery in many jurisdictions.

Cultural Differences

Variations in the norms, values, beliefs, and practices among different groups, societies, or individuals, arising from ethnic, racial, socioeconomic, geographical, or other distinctions.