A Company Is Considering Producing a Product for a New

question 40

Multiple Choice

A company is considering producing a product for a new market. The fixed costs required for manufacturing and delivering the product is $50,000. Labour and material costs are estimated to be approximately $25.00 per product. If the product is sold for $35.00 each, the firm's break-even volume would be

• A) 50,000 units.
• B) 5,000 units.
• C) 2500 units.
• D) 500 units.

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Definitions:

U.S. Department of Justice

A federal executive department responsible for enforcing the law and administration of justice in the United States, headed by the Attorney General.

Monopoly

A market structure characterized by a single seller who has exclusive control over a product or service.

Antitrust Law

Legal regulations designed to promote fair competition for the benefit of consumers, by preventing monopolies, cartels, and other practices that restrain free trade.

Interstate Commerce

Trade, traffic, or transportation involving the movement of goods or people across state lines, regulated by federal law.