The Estimated Unit Costs for a Company to Produce and Sell

question 109

Multiple Choice

The estimated unit costs for a company to produce and sell a product at a level of 12,000 units per month are as follows:
$$\begin{array} { l r } & \text { Estimated } \\\text { Cost Item } & \text { Unit Cos } \\\text { Direct material } & \$ 3 2 \\\text { Direct labor } & 20 \\\text { Variable manfacturing overhead } & 15 \\\text { Fixed manfacturing overhead } & 6 \\\text { Variable selling expenses } & 3 \\\text { Fixed selling expenses } & 4\end{array}$$
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What are the estimated variable costs per unit?

• A) $70
• B) $38
• C) $67
• D) $52

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Definitions:

National Debt

National debt is the total amount of money that a country's government has borrowed, by various means, including bonds and securities, from domestic or foreign sources.

MPC (Marginal Propensity To Consume)

Measures the proportion of additional income that a consumer spends on goods and services rather than saving.

GDP

GDP stands for Gross Domestic Product, which is an indicator of a nation's economic health, calculated by adding up the value of every good and service produced for a certain period.

Multiplier

A factor that quantifies the additional economic impact of spending; it measures by how much a change in investment or government spending will affect the total economic output.