A Firm Has $50,000 in Fixed Costs, a Selling Price

question 91

Multiple Choice

A firm has $50,000 in fixed costs, a selling price of $25 per unit, and variable costs of $5 a unit. If the fixed costs are reduced to $40,000:

• A) Breakeven volume will decrease.
• B) Breakeven volume will increase.
• C) Profits will be reduced.
• D) Selling price will be increased.

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Definitions:

Organization Size

The scale or extent of an organization, often measured by the number of its employees, the size of its operation, or its market reach.

Scientific Management Approach

A theory of management that analyzes and synthesizes workflows to improve economic efficiency, especially labor productivity.

Productivity Rewards

Incentives or benefits given to employees as recognition for achieving high levels of work output or efficiency.

Task Performance

The execution and efficiency of completing specific tasks or duties, often measured through criteria such as speed, accuracy, and proficiency.