Polynesian Products Sells 1,800 Kayaks Per Year at a Price

question 91

Multiple Choice

Polynesian Products sells 1,800 kayaks per year at a price of $480 per unit. Polynesian sells in a highly competitive market and uses target pricing. The company has calculated its target full cost at $729,000 per year. Total variable costs are $396,000 per year and cannot be reduced. How much are the target fixed costs?

• A) $265,000
• B) $410,000
• C) $396,000
• D) $333,000

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Definitions:

Defense Reaction

A psychological or physiological response to a perceived threat to one’s well-being, often involving strategies to cope with stress or anxiety.

Learned Taste Aversion

The phenomenon where an individual develops a dislike or avoidance of a particular food after a negative experience, such as sickness, that gets associated with that food.

Trial-And-Error Learning

Trial-and-error learning is a form of problem-solving that involves attempting different solutions and learning from mistakes until the correct solution is found.

Response Control

The ability to regulate one's reactions to external stimuli, often in the context of behavioral psychology.