A Business Received an Offer from an Exporter for 10,000

question 18

Multiple Choice

A business received an offer from an exporter for 10,000 units of product at $13.50 per unit.The acceptance of the offer will not affect normal production or domestic sales prices.The following data are available:

• A)$75,000 loss
• B)$40,000 gain
• C)$15,000 gain
• D)$85,000 gain

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Definitions:

Downward-Sloping Demand

A concept in economics that illustrates the inverse relationship between the price of a good and the quantity demanded by consumers.

Perfectly Competitive Firm

A company that operates in a market where there are many buyers and sellers, and where no single buyer or seller can influence the price of the product.

Horizontal Demand

Describes a demand curve that is perfectly elastic, indicating that even a very small change in price would lead to an infinite change in the quantity demanded, typically theoretical and not found in real-world markets.

Product Differentiation

Strategies used by companies to make their products appear unique from those of competitors.