Anderson Corporation Sells Picture Calendars for $10 Each

question 134

Multiple Choice

Anderson Corporation sells picture calendars for $10 each. The fixed costs of production are $300,000, and the variable costs are 60% of the selling price. The company desires to make a profit of $120,000. How many calendars must it sell?

• A) 105,000
• B) 70,000
• C) 30,000
• D) 75,000

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Definitions:

Production Costs

The total expenses incurred by a company to produce goods or services, including labor, materials, and overhead costs.

Cournot Duopolists

A scenario in an oligopoly market structure where two firms, known as duopolists, decide on the quantity to produce independently and simultaneously with the goal of maximizing profit.

Marginal Costs

The boost in cost necessitated by the output of one more unit of a product or service.

Demand for Wine

The desire or need by consumers to purchase wine, which varies depending on factors like price, income levels, and personal preferences.