Parker Industries Is a Small Company with a Big Name!

question 41

Multiple Choice

Parker Industries is a small company with a big name! Parker Industries is actually a one-person company that imports strands of LED lights from China and sells them through its website. Parker's only overhead is a storage unit for inventory that costs $125 a month and a $25 monthly fee for website hosting. Currently, Parker imports the lights for $.99 each (including inbound shipping) and sells them for $4.49. Parker also pays shipping expenses of $.50 per light strand. If Parker's shipping charges increased to $.75 a strand, what would happen?

• A) Breakeven volume would increase
• B) Variable cost would decrease
• C) Profit would increase
• D) Breakeven volume would decrease

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Definitions:

Diabetes Mellitus

A metabolic disease characterized by high blood sugar levels over a prolonged period, due to insulin production or response issues.

Adenohypophysis

The anterior lobe of the pituitary gland, responsible for secreting several key hormones that regulate growth, reproduction, and metabolism.

Anterior Lobe

The front part of an organ or gland, such as the anterior lobe of the pituitary gland, involved in hormone secretion.

Pituitary Gland

A small, pea-sized gland located at the base of the brain, responsible for controlling important body functions through the release of hormones.