Colin Was a Professional Classical Guitar Player Until His Motorcycle

question 162

Multiple Choice

Colin was a professional classical guitar player until his motorcycle accident that left him disabled. After long months of therapy, he hired an experienced luthier (maker of stringed instruments) and started a small shop to make and sell Spanish guitars. The guitars sell for $700 and the fixed monthly operating costs are as follows: Colin's accountant told him about contribution margin ratios and he understood clearly that for every dollar of sales, $0.65 went to cover his fixed costs, and that anything past that point was pure profit. Colin wishes to earn $4,000 of operating profit each month. Calculate the number of guitars Colin will have to sell to achieve the target profit.

• A)39 guitars
• B)33 guitars
• C)15 guitars
• D)18 guitars

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Definitions:

Pseudoconflict

A perceived conflict that arises from misunderstandings or miscommunications rather than actual disagreements or differences.

Simple Conflict

A basic disagreement or clash between parties with differing opinions, interests, or goals, which is typically uncomplicated and resolvable through communication.

Ego Conflict

occurs when a disagreement or confrontation challenges an individual's sense of self-esteem or identity.

Ego Conflict

A type of conflict that arises when a disagreement becomes personal, leading to attacks on someone's character or self-esteem.