-Suppose You Are the Owner of a Picture Frame Store

question 299

Multiple Choice

-Suppose you are the owner of a picture frame store. Let's assume that the average price customers are willing to pay for each picture frame is $120. Also, suppose your fixed costs (FC) total $32,000 (real estate taxes, interest on a bank loan, etc.) and unit variable cost (UVC) for a picture frame is $40 (labor, glass, frame, and matting) . According to Figure 11-6 above, how much profit will your picture frame store make if it sells 400 picture frames?

• A)$48,000
• B)$32,000
• C)$16,000
• D)$0
• E)($32,000)

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