Olive Corp

question 105

Multiple Choice

Olive Corp.currently makes 20,000 subcomponents a year in one of its factories.The unit costs to produce are: An outside supplier has offered to provide Olive Corp.with the 20,000 subcomponents at a $36 per unit price.Fixed overhead is not avoidable.What is the maximum price Olive Corp.should pay the outside supplier?

• A)$32
• B)$36
• C)$40
• D)$44

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Definitions:

Marketing

The process of promoting, selling, and distributing a product or service, including market research and advertising.

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The activities involved in selling products or services, including marketing, negotiation, and transaction processes.

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A retail establishment that sells coffee, tea, and often light meals or pastries, providing a social or work space for customers.

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Contractual agreement in which a franchisee gains the right to produce and/or sell the franchisor’s products under that company’s brand name if they agree to certain operating requirements.