Given the Following Data If Sales Decrease by 500 Units, by What Percent Would

question 45

Multiple Choice

Given the following data:
$$\begin{array} { l r r r } &{ \text { Per Unit } } & \text { Total } \\\text { Sales } & \$ 15 & \$ 45,000 \\\text { Less variable expenses } & 9 & 27,000 \\\text { Contribution margin } & 6& 18,000 \\\text { Less fixed expenses } & & 12,000 \\\text { Operating profit } & & \$ 6,000\end{array}$$
If sales decrease by 500 units, by what percent would fixed costs have to be reduced by to maintain current operating profit?

• A) 50.0%.
• B) 33.3%.
• C) 25.0%.
• D) 16.7%.

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Definitions:

Alternative Evaluation

The stage in the consumer decision-making process where individuals compare different products or brands they have identified as being capable of satisfying their need.

Postpurchase Behavior

The actions and reactions of consumers after purchasing a product or service, including satisfaction, regret, or loyalty.

Repeated Experience

A scenario in which an individual encounters the same event, activity, or situation multiple times, leading to familiarity or skill improvement.

Psychosocial Edification

The process of educating or improving an individual's psychological and social skills and knowledge for better interpersonal interactions and personal development.