The Following Data Are Available for the North Division of Chemicals

question 118

Multiple Choice

The following data are available for the North Division of Chemicals Products,Inc.and the single product it makes:
$\begin{array}{|l|r|}\hline \text { Unit Selling Price } & \$ 25 \\\hline \text { Variable Cost per Unit } & \$ 15 \\\hline \text { Annual Fixed Costs } & \$ 320,000 \\\hline \text { Average Operating Assets } & \$ 1,500,000 \\\hline\end{array}$
How many units must South sell each year to have an ROI of 18%?

• A) 32,760 units.
• B) 35,760 units.
• C) 240,000 units.
• D) 1,300,000 units.

Comprehend the purpose and process of product modification as a strategy to enhance product value and sales.

Understand the use of marketing metrics, specifically CDI and BDI, to analyze product performance and market opportunity.

Interpret CDI/BDI marketing dashboards to make informed decisions about market segments.

Distinguish between the various types of barriers (usage, value, risk, psychological) that affect product adoption.

---

Definitions:

Put

An option contract giving the owner the right, but not the obligation, to sell a specified amount of an underlying security at a specified price within a specified time.

Premium

The amount paid for an insurance policy or an amount paid above the nominal value for a security; also, the fees paid for an option contract.

Protective Put

Purchase of an asset combined with a put option on that asset to guarantee proceeds at least equal to the put’s exercise price.

Underlying Asset

The financial asset upon which a derivative instrument, such as a futures or options contract, is based.