If Fixed Costs Are $450,000 and the Unit Contribution Margin

question 67

True/False

If fixed costs are $450,000 and the unit contribution margin is $50, the sales necessary to earn an operating income of $30,000 are 14,000 units.

---

Definitions:

Government Purchases

Spending by the government on goods and services that are directly consumed or invested in by the government sector.

Short-Run Aggregate Supply

The total production of goods and services in an economy at different price levels in a short time frame, assuming that some production costs remain fixed.

Spending Multiplier

The ratio of a change in national income to a change in government spending that causes it, indicating the impact of fiscal policy on the economy.

Long Run

A period of time in economics where all factors of production and costs are variable, and all market adjustments have been made.