The Actual Volume and Volume Estimated in a Business Plan

question 4

Multiple Choice

The actual volume and volume estimated in a business plan are 60,000 units and 55,000 units,respectively.If the volume variance of the business works out to $30,000,calculate the margin per unit estimated in the plan.

• A)$6
• B)$10
• C)$15
• D)$18.5
• E)$24.5

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Definitions:

Random Variable X

A variable whose possible values depend on the outcomes of a probabilistic phenomenon.

Expected Profit

The forecasted amount of profit, calculated as the sum of all possible profits each multiplied by their probabilities of occurrence.

Probability Of

The likelihood or chance of a specific event occurring within a set of possible outcomes.

Major Loss

A significant financial setback or damage, often used in the context of insurance, investments, or business operations.