Assume That You and Your Brother Plan to Open a Business

question 86

Multiple Choice

Assume that you and your brother plan to open a business that will make and sell a newly designed type of sandal.Two robotic machines are available to make the sandals,Machine A and Machine B.The price per pair will be $30.00 regardless of which machine is used.The fixed and variable costs associated with the two machines are shown below.What is the difference between the break-even points for Machines A and B? Do not round your intermediate calculations.(Hint: Find BE_B - BE_A) $\begin{array}{lrr} & \text { Machine A } & \text { Machine B } \\\text { Price per pair (P) } & \$ 30.00 & \$ 30.00 \\\text { Fixed costs (F) } & \$ 25,000 & \$ 100,000 \\\text { Variable cost/unit (V) } & \$ 7.00 & \$ 4.00\end{array}$
?

• A) 3,035
• B) 2,235
• C) 2,069
• D) 2,621
• E) 2,759

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Definitions:

Risky Shift

Is the phenomenon where groups tend to make riskier decisions together than individuals would on their own, often attributed to the diffusion of responsibility.

Selective Perception

The process where individuals selectively interpret what they see based on their interests, background, experience, and attitudes.

Perceptual Bias

is the tendency for perception to be affected by recurring thoughts, beliefs, or attitudes, leading to distorted interpretations of information.

Attribution Bias

A cognitive bias that affects the way people deduce the causes of their own and others' behaviors, often attributing them incorrectly.