A Product's Markup Percentage Would Need to Cover Fixed Manufacturing

question 104

Multiple Choice

A product's markup percentage would need to cover fixed manufacturing costs if

• A)the company has only fixed manufacturing costs.
• B)the company wants to break-even during the fiscal period.
• C)the company wants to make a profit.
• D)the cost base does not include fixed manufacturing costs.
• E)the cost base includes fixed manufacturing costs as well as variable costs.

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Definitions:

Collateral

An asset or property that a borrower offers to a lender as security for a loan, which can be seized if the loan is not repaid.

Attachment

The legal process of seizing property to secure the satisfaction of a judgment.

Securitization

The process of bundling securities and then selling them to big investors.

Balloon-Payment Mortgage

A balloon-payment mortgage is a type of loan that features low initial payments but ends with a large lump-sum payment due at the end of the mortgage term.