A Product Is Priced to Sell for $12 with Average

question 68

Multiple Choice

A product is priced to sell for $12 with average variable costs of $8. The company's total fixed costs are $120,000. The minimum number of units that must be sold in order to the breakeven point with zero profits are:

• A) 40,000
• B) 30,000
• C) 15,000
• D) 10,000

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Definitions:

Loss

The state or condition of not having something anymore, often referring to the disadvantage suffered following a particular event or action.

Breach of Warranty

Failure to meet the terms of a promise or guarantee made about the quality or durability of a product or service.

Auto Insurance

A type of insurance policy that covers vehicles and their drivers against potential financial losses related to accidents, theft, or damage.

Commercial Business

An organization engaged in activities aimed at the sale of goods and services to consumers with the goal of earning profit.