Appalachian Crafts Is Analyzing a Project with Expected Sales of 18,900

question 64

Multiple Choice

Appalachian Crafts is analyzing a project with expected sales of 18,900 units,±2 percent.The expected variable cost per unit is $23 and the expected fixed costs are $52,000.Cost estimates are considered accurate within a range of ±1 percent.The depreciation expense is $18,400.The sale price is estimated at $54 a unit,±2 percent.What is the total dollar difference between the revenue using the optimistic sale price versus the expected sale price?

• A)$24,600
• B)$16,800
• C)$20,412
• D)$17,894
• E)$22,200

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Definitions:

Grams

Grams are a unit of mass in the metric system, used to measure small weights of substances or objects, equivalent to one thousandth of a kilogram.

Decision Variables

Variables that represent choices available to a decision-maker in optimization problems.

Objective

A specific, measurable goal or target that an individual, team, or organization aims to achieve within a set timeframe.

Constraints

Limitations or restrictions that define the parameters within which a system or process must operate.