Use the Figure for the Question(s)below

question 97

Multiple Choice

Use the figure for the question(s) below.
-A company planning to market a new model of motor scooter analyzes the effect of changes in the selling price of the motor scooter,the number of units that will be sold,the cost of making the motor scooter,the effect on Net Working Capital,and the cost of capital for the project.They predict that the break-even point for sales price for the motor scooter is $2480.What does this mean?

• A)If the motor scooter is sold for $2480,then the project will make a profit.
• B)If the motor scooter is sold for $2480,then the net present value (NP
• V)for the product will be zero.
• C)The predicted selling price of the motor scooter is $2480.
• D)The maximum that the motor scooter can sell for and still make the project have a positive net present value (NP
• V)is $2480.
• E)If the motor scooter is sold for $2480,the company will not go bankrupt.

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Definitions:

Properly Calibrated

Refers to the accurate adjustment of instruments, equipment, or devices to ensure their measurements meet the required standards.

Electronic Control

Systems or devices that use electrical signals to regulate or manage other electronic systems.

Significant Level

This term likely refers to significance level; thus it is the threshold at which the p-value of test results must fall below to reject the null hypothesis, indicating statistical significance.

Standard Deviation

A statistic that measures the dispersion or variability of a dataset relative to its mean, indicating how spread out the data points are.