Suppose a fiRm Has Net Income of $100 and a Profit

question 207

Multiple Choice

Suppose a firm has net income of $100 and a profit margin equal to 14%. If the firm is working at 2/3 capacity, then full capacity sales are:

• A) $476
• B) $539
• C) $714
• D) $823
• E) $1,071

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Definitions:

Market Entry

The process or strategy by which a company enters a new market or industry.

Average Cost

The total cost of production divided by the number of units produced, often used to determine the efficiency of production.

Park Funding

Financial resources allocated for the maintenance, development, and improvement of public parks.

Taxpayers

Individuals or entities that are obligated to pay taxes to a governmental authority.