Assume an Organization Must Invest $100,000 in Fixed Costs to Produce

question 14

Multiple Choice

Assume an organization must invest $100,000 in fixed costs to produce a product that sells for $100 and requires $50 in variable costs to produce one unit. What is the organization's breakeven volume?

• A) 1000 units
• B) 1500 units
• C) 2000 units
• D) 2500 units
• E) None of the above

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Definitions:

Conservation Cost

The expenses associated with the actions taken to preserve natural resources or to minimize environmental impact.

Nonrenewable Resource

A natural resource that cannot be replenished or regenerated at the same rate at which it is consumed, such as oil, natural gas, and minerals.

Ethanol

A renewable fuel made from various plant materials collectively known as "biomass."

Economically Viable

A situation or project that is financially sustainable, able to generate revenue that exceeds its operating costs.