Malone Printing Company Projected the Following Information for Next Year

question 91

Multiple Choice

Malone Printing Company projected the following information for next year: $\begin{array}{lr}\text { Selling price per unit } & \$ 75.00 \\\text { Contribution margin per unit } & \$ 30.00 \\\text { Total fixed costs } & \$ 120,000 \\\text { Tax rate } & 40 \%\end{array}$
How many units must be sold to obtain an after-tax profit of $67,500?

• A)3,750 units
• B)5,167 units
• C)5,625 units
• D)7,750 units

---

Definitions:

Market Risk Premium

The extra yield an investor anticipates earning by choosing a volatile market portfolio over secure, risk-free investments.

Required Return

Required return is the minimum gain an investor expects to achieve from an investment, accounting for the risk level compared to the return of a risk-free asset.

Risk-Free Rate

The return on investment with no loss of principal, often represented by the yield on government securities.

Beta

An indicator that determines the systematic risk or volatility of a security or a portfolio relative to the overall market.