A Company Manufactures Three Products as Shown Below The Company Should:
A)continue Producing C Because It Has a a Decision

question 11

Multiple Choice

A company manufactures three products as shown below.It is considering a decision to discontinue the production of product C.Corporate overhead of $60,000 is allocated to each product in equal parts.If the company decides to discontinue product C,50% of its quantity demanded will shift to product A (i.e.,products A and C are substitutes) .Product B is neither a substitute nor a complement for product A or product C. $\begin{array}{|l|r|r|r|}\hline &A&B&C\\\hline \text { Unit Price } & \$ 10.00 & \$ 15.00 & \$ 5.00 \\\hline \text { Marginal Cost } & \$ 5.00 & \$ 5.00 & \$ 3.00 \\\hline \text { Quantity Sold } & 10,000 & 2,000 & 3,000 \\\hline \text { Unit Margin } & \$ 5.00 & \$ 10.00 & \$ 2.00 \\\hline \text { Total Margin } & \$ 50,000.00 & \$ 20,000.00 & \$ 6,000.00 \\\hline \text { Overhead Allocation } & \$ 20,000.00 & \$ 20,000.00 & \$ 20,00.00 \\\hline \text { Accounting Profit } & \$ 30,000.00 & \$ 0.00 & -\$ 14,000.00\\\hline\end{array}$ The company should:

• A)continue producing C because it has a positive unit margin.
• B)continue producing C because the substitution effect does not compensate for the loss of profit contribution from product C.
• C)discontinue producing C because this decision maximizes the total economic profit contribution generated by the company.
• D)discontinue both B and C since neither has a positive contribution to economic profit.

Understand the conceptual basis and consequences of commons dilemmas.

Identify strategies and interventions for resolving environmental issues and promoting sustainable behaviors.

Analyze the role of psychological and social factors in shaping attitudes towards environmental conservation.

Distinguish between different types of social dilemmas and their implications for resource management.

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Definitions:

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