The Skyways Company Is Currently Selling Its Single Product for $15

question 106

Multiple Choice

The Skyways Company is currently selling its single product for $15. Variable costs are estimated to remain at 70% of the current selling price and fixed costs are estimated to be $4,800 per month. If Skyways increases its selling price by 10%, its variable cost ratio will:

• A) not change.
• B) decrease.
• C) increase.
• D) Cannot determine with the information given.

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Definitions:

Simple Interest

Interest calculated only on the principal amount, or the initial sum of money invested or borrowed, without compounding.

Convert Communicator

This term refers to an individual who adopts new beliefs or practices and then acts to persuade others to adopt these new beliefs or practices as well.

Previously Held Attitudes

Beliefs or opinions that an individual had before being exposed to new information or experiences.

Arguing Against

The process of presenting reasons or evidence to counter or dispute a particular claim, opinion, or proposition.