Data Concerning Pellegren Corporation's Single Product Appear Below: Fixed

question 133

Multiple Choice

Data concerning Pellegren Corporation's single product appear below: Fixed expenses are $531,000 per month. The company is currently selling 4,000 units per month. The marketing manager would like to cut the selling price by $14 and increase the advertising budget by $35,000 per month. The marketing manager predicts that these two changes would increase monthly salesvolume by 500 units. What should be the overall effect on the company's monthly net operating income of this change?

• A) decrease of $18,000
• B) increase of $38,000
• C) decrease of $38,000
• D) increase of $58,000

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Definitions:

Market Values

The current price at which an asset or service can be bought or sold in the marketplace.

Human Reproduction

The biological process through which humans produce offspring, involving complex physiological processes and hormonal interactions.

Children

This term generally refers to young humans, often defined as persons under the age of 18.

Leon Kass

An American bioethicist known for his conservative views on biotechnology and his concept of the "wisdom of repugnance."