NF Toy Company Is Unsure of Whether to Sell Its

question 44

Multiple Choice

NF Toy Company is unsure of whether to sell its product assembled or unassembled. The unit cost of the unassembled product is $30 and NF Toy would sell it for $65. The cost to assemble the product is estimated at $21 per unit and the company believes the market would support a price of $85 on the assembled unit. What decision should NF Toy make?

• A) Sell before assembly, the company will be better off by $1 per unit.
• B) Sell before assembly, the company will be better off by $20 per unit.
• C) Process further, the company will be better off by $29 per unit.
• D) Process further, the company will be better off by $14 per unit.

---

Definitions:

Condition Concurrent

A situation in a contract wherein the parties involved must perform their respective obligations at the same time.

Washing

Typically refers to cleaning something by immersing and agitating it in water or another liquid.

Conditional Contract

An agreement that becomes enforceable only after certain conditions are met or fulfilled.

Condition Precedent

In a contract, an event that must occur in order for a party’s duty to arise.