Geren Company Produces and Sells a Product That Has Variable

question 57

Multiple Choice

Geren Company produces and sells a product that has variable costs of $9 per unit and fixed costs of $200,000 per year. If production decreases from 50,000 to 40,000 units, the cost per unit will:

• A) increase by $1
• B) increase to $13
• C) decrease to $14
• D) decrease by $1

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Definitions:

Surface

The outward or visible aspect of something, sometimes contrasted with deeper, more hidden dimensions.

Positive Disposition

A tendency to maintain a positive outlook and approach situations with a constructive attitude.

Critical Thinking

The method of impartially examining and assessing a matter to reach a decision.

Skilled and Eager

Describes someone who possesses the necessary abilities or proficiency and shows a keen enthusiasm or readiness to undertake tasks.