A Manufacturer Contemplates a Change in Technology That Would Reduce

question 70

Multiple Choice

A manufacturer contemplates a change in technology that would reduce fixed costs from $800,000 to $600,000, and reduce depreciation expense from $125,000 to $100,000.However, the ratio of variable costs to sales will increase from 68 percent to 80 percent.What will happen to break-even level of revenues?

• A)a reduction to the level of $875,000
• B)a reduction to the level of $2,890,625
• C)an increase to the level of $3,500,000
• D)an increase to the level of $3,625,000

---

Definitions:

Classes

Categories into which data, objects, or individuals are grouped based on similar characteristics or criteria.

Line Chart

A graphical representation that connects individual data points with lines to show trends over a period of time.

Variable

An attribute or detail that can change or alter.

Time Periods

Specific intervals or periods used for analysis or measurement in temporal data or time series analysis.