The Cost Function for Ciao Company Is: TC = $800

question 3

Multiple Choice

The cost function for Ciao Company is: TC = $800 + 0.375 × Revenue. If Ciao expects after-tax income of $600, and the tax rate is 40%, what is the firm's margin of safety?

• A) $3,680
• B) $2,400
• C) $2,880
• D) $1,600

---

Definitions:

Software Piracy

The unauthorized copying, distribution, or use of copyrighted software.

Base 2 System

A numeral system that uses 2 as its base, employing only two symbols, 0 and 1, also known as the binary system.

Mobile Device

A portable computing device such as a smartphone or tablet that has its own operating system and can run various applications.

Binary System

A method of representing data using only two symbols, typically 0 and 1, forming the basis of all modern computing systems.