Two Firms, C and D, Both Produce Coat Hangers

question 39

Multiple Choice

Two firms, C and D, both produce coat hangers.The price of coat hangers is $1.20 each.Firm C has total fixed costs of $750,000 and variable costs of 30'per coat hanger.Firm D has total fixed costs of $400,000 and variable costs of 50' per coat hanger.The corporate tax rate is 40%.If the economy is strong, each firm will sell 2,000,000 coat hangers.If the economy enters a recession, each firm will sell 1,400,000 coat hangers. If the economy is strong, the total revenue of firm C will be

• A)$1,680,000.
• B)$1,400,000.
• C)$2,000,000.
• D)$2,400,000.

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Definitions:

Heavy-Duty Truck

A truck designed for high-load capacity and durability, typically used for commercial purposes, such as hauling goods or construction equipment.

Driveshaft

An assembly of one or more propeller shafts (hollow tubes) connected by universal joints (U-joints) to driven driveline components. In a typical tandem drive highway tractor, driveshafts are used to transmit torque from the transmission and forward differential carrier and between the two differential carriers.

Dynamically Balance

The process of balancing a rotating component while it is in motion to minimize vibrations and ensure smooth operation.

Transmission

A mechanical system in vehicles that transfers power from the engine to the drive axle, modulating engine output through various gear ratios.