Refer to Scenario 9

question 282

Multiple Choice

Refer to Scenario 9.1 below to answer the question(s) that follow.
SCENARIO 9.1: Amy borrowed $20,000 from her parents to open a bagel shop. She pays her parents a 5% yearly return on the money they lent her. Her other yearly fixed costs equal $9,000. Her variable costs equal $30,000. In her first year, Amy sold 40,000 dozen at a price of $1.50 per dozen.
-Refer to Scenario 9.1. Amy's profit is

• A) $0.
• B) $20,000.
• C) $30,000.
• D) $50,000.

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Definitions:

Restatement (Second)

A collection of model legal rules and principles that aims to simplify and clarify the law, often referring specifically to American law.

Products Liability

The area of law in which manufacturers, distributors, suppliers, retailers, and others who make products available to the public are held responsible for the injuries those products cause.

Express Warranty

An explicit guarantee by a seller to a buyer that a product or service meets certain quality and performance standards.

Sample

A small part or quantity intended to show what the whole is like.