Use the Information Below to Answer the Following Questions -Refer to the Table Above

question 39

Multiple Choice

Use the information below to answer the following questions.
Sales Extraordinaire sells one particular photo frame. It estimates that it can sell as many frames as it produces. $\begin{array}{lr}\text { Sales price per unit } & \$ 6.00 \\\text { Variable cost per unit } & \$ 3.00 \\\text { Fixed costs per annum } & \$ 9,000\end{array}$
-Refer to the table above. Increasing the sales price to $8.00 and having a sales volume of 3,000 photo frames would result in:

• A)a profit of $6,000.
• B)a loss of $1,000.
• C)breaking even.
• D)a profit of $1,000.

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Definitions:

Comprehensive Exam

A detailed and extensive exam typically covering multiple subjects or the entirety of a specific subject, often used as a qualification or assessment in higher education.

Law of Diminishing Returns

An economic principle stating that as investment in a particular area increases, the rate of profit from that investment, after a certain point, cannot continue to increase if other inputs remain at a constant.

Marginal Study Time

The additional amount of time spent studying beyond the current level, focusing on the impact on overall academic performance.

Sunk Cost

Past expenses that have already been incurred and cannot be recovered or altered.