The Precision Writing Instruments Company Makes Two Pen Designs -

question 153

Multiple Choice

The Precision Writing Instruments Company makes two pen designs - the Cordova design and the Savannah design. These data apply, regardless of which of two pen designs is being implemented. Materials cost per pen is $6. Labour cost per pen is $5. Production overhead is $1,000,000. Advertising and promotion is $1,000,000. Marketing research has estimated the following demand functions for the next year of sales for the two pen designs where Q represents demand in thousands and P represents price. For the Cordova design, Q = 150 - 2.5P. For the Savannah design, Q = 175 - 2.1P. What are the total costs for sales of 500,000 units of the Cordova design?

• A)$3,650,000
• B)$7,500,000
• C)$5,500,000
• D)$2,000,000

---

Definitions:

Primary Dysmenorrhea

Painful menstrual cramps that originate in the uterus and occur in the absence of other diseases.

Amenorrhea

The absence of menstruation in a woman of reproductive age, which could be either primary (never having menstruated) or secondary (cessation of periods after they have already begun).

Premenstrual Dysphoric Disorder

A diagnosis that includes severe, distinct, and persistent symptoms associated with menstruation.

Eclampsia

A severe complication of pregnancy characterized by high blood pressure and signs of organ damage, often leading to seizures.