Your fiRm Currently Sells 320 Units a Month at a Price

question 336

Multiple Choice

Your firm currently sells 320 units a month at a price of $175 a unit. You think you can increase your sales by an additional 125 units if you switch to a net 30 credit policy. The monthly interest rate is .5
Percent and your variable cost per unit is $94. What is the net present value of the proposed credit
Policy switch?

• A) $1,506,500
• B) $1,625,750
• C) $1,875,000
• D) $1,957,250
• E) $2,092,750

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Definitions:

Fruit

The mature ovary of a flowering plant, usually containing seeds, that is consumed as food by humans and animals.

Cognitive Development

The growth of cognitive abilities and capacities from infancy through adulthood, involving processes such as thinking, problem-solving, and memory.

Piaget

A psychologist from Switzerland recognized for his groundbreaking contributions to the field of child development and his cognitive development theory.

Cultural Context

The various social, religious, economic, and cultural circumstances that influence the environment in which individuals live and interact.