Thornbrough Corporation Produces and Sells a Single Product with the Following

question 243

Multiple Choice

Thornbrough Corporation produces and sells a single product with the following characteristics:
The company is currently selling 7,000 units per month. Fixed expenses are $901,000 per month. Consider each of the following questions independently.
-This question is to be considered independently of all other questions relating to Thornbrough Corporation.Refer to the original data when answering this question. Management is considering using a new component that would increase the unit variable cost by $11.Since the new component would increase the features of the company's product,the marketing manager predicts that monthly sales would increase by 500 units.What should be the overall effect on the company's monthly net operating income of this change?

• A) increase of $82,500
• B) decrease of $5,500
• C) decrease of $82,500
• D) increase of $5,500

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Definitions:

Color

The attribute of visual perception described through hue, saturation, and brightness, as determined by the spectral composition of light.

Black and White

Thinking characterized by absolute terms, seeing everything as one extreme or the other with no middle ground.

Common Emotion

A basic emotional experience shared among humans, such as happiness, sadness, anger, fear, surprise, and disgust.

Sexual Frustration

The condition of having unfulfilled sexual desires or needs, which may lead to psychological stress or tension.