A Product Sells for $30 Per Unit and Has Variable

question 74

Multiple Choice

A product sells for $30 per unit and has variable costs of $18 per unit. The fixed costs are $720,000. If the variable costs per unit were to decrease to $15 per unit and fixed costs increase to $900,000, and the selling price does not change, break-even point in units would:

• A) Increase by 20,000.
• B) Equal 6,000.
• C) Increase by 6,000.
• D) Decrease by 20,000.
• E) Not change.

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Definitions:

Redemption Date

The specific date at which a bond or other debt instrument can be repaid before its maturity.

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The process by which a private company offers shares to the public in a new stock issuance to raise capital.

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The U.S. Securities and Exchange Commission, a federal agency responsible for regulating the securities industry and protecting investors.

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