Your Company Currently Sells a Product with a Variable Cost

question 90

Multiple Choice

Your company currently sells a product with a variable cost per unit of $16 and a unit selling price of $31. At the present time, your company only sells on a cash basis and has monthly sales of 310 units. The monthly interest rate is 2 percent. Your company is considering switching to a net 30 credit policy. What is the switch break-even point?

• A) 312 units
• B) 316 units
• C) 320 units
• D) 323 units
• E) 329 units

Analyze the impact of changes in economic factors on expected stock returns.

Understand the relevance and application of CAPM in financial decision-making and investment evaluation.

Interpret the implications of beta in assessing systematic risk.

Recognize the use and importance of CAPM among financial professionals in estimating the cost of capital.

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