Raymond Estimates That the Fixed Costs Associated with Opening a New

question 29

Multiple Choice

Raymond estimates that the fixed costs associated with opening a new bank branch are $500 ,000.He expects the branch to attract 1,000 new customer accounts in the first year,each of which will cost $50 per year to service.He also expects to generate $100,000 per year in revenue.For Raymond,the total cost of opening the new branch and remaining open for one year will be

• A) $500
• ,000.
• B) $550
• ,000.
• C) $650
• ,000.
• D) $450
• ,000.
• E) $605
• ,000.

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