Firm a Produces Gadgets

question 77

Multiple Choice

Firm A produces gadgets.The price of gadgets is $2 each.Firm A has total fixed costs of $1,000,000 and variable costs of $1.00 per gadget.The corporate tax rate is 40%.If the economy is strong,the firm will sell 2,000,000 gadgets.If the economy enters a recession it will sell only half as many gadgets.If the economy enters a recession,the after-tax profit of Firm A will be _________.

• A) $0
• B) $90,000
• C) $180,000
• D) $270,000

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Definitions:

Delayed Development Indicator

A sign or measure that suggests a slower than typical progress in physical, emotional, or intellectual growth in children.

Intellectual Disability

A condition characterized by significant limitations in intellectual functioning and in adaptive behavior, which covers a range of everyday social and practical skills.

Moderate

Not extreme or excessive; average in amount, intensity, quality, or degree.