The Congress Company Has Identified Two Methods for Producing Playing

question 21

Multiple Choice

The Congress Company has identified two methods for producing playing cards. One method involves using a machine having a fixed cost of $10,000 and variable costs of $1.00 per deck of cards. The other method would use a less expensive machine (fixed cost = $5,000) , but it would require greater variable costs ($1.50 per deck of cards) . If the selling price per deck of cards will be the same under each method, at what level of output will the two methods produce the same net operating income (EBIT) ?

• A) 5,000 decks
• B) 10,000 decks
• C) 15,000 decks
• D) 20,000 decks
• E) 25,000 decks

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Definitions:

Meiosis

Meiosis is a type of cell division that reduces the chromosome number by half, resulting in the production of haploid gametes or spores.

Fertilization

The process of combining male (sperm) and female (ovum) gametes to form a zygote, initiating embryonic development in sexually reproducing organisms.

Sporogenesis

The process of spore formation, especially in fungi, algae, mosses, and ferns.

Bacteria

Single-celled microorganisms that can exist either as independent organisms or as parasites, some of which can cause diseases.