Maxi Production Is a Price-Taker

question 30

Multiple Choice

Maxi Production is a price-taker. They produce large spools of electrical wire in a highly competitive market, and so they practice target pricing. The current market price is $800 per unit. The company has $2,000,000 in assets and shareholders expect a return of 5% on assets. The company provides the following information: Currently the cost structure is such that the company cannot achieve its profit objective and must cut costs. If fixed costs CANNOT be reduced, how much does the variable cost per unit need to be in order to hit the profit goal? (Please round to the nearest cent.)

• A)$675.67 per unit
• B)$642.00 per unit
• C)$665.56 per unit
• D)$694.20 per unit

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Definitions:

Monoamines

A group of neurotransmitters, including dopamine, serotonine, and norepinephrine, that play key roles in regulating mood, arousal, and cognition.

Endorphins

Natural, opiate-like neurotransmitters linked to pain control and to feeling pleasure.

Dopamine

A neurotransmitter in the brain that plays a key role in regulating mood, motivation, and reward, among other functions.

Action Potential

A rapid, temporary change in the electrical charge of a cell membrane, essential for nerve signal transmission.