A Small Business Produces a Single Product and Reports the Following

question 47

Multiple Choice

A small business produces a single product and reports the following data: The price is raised to $8.50 per unit, and the volume drops to 9.000 units per month.
Assume other factors remain the same. How would this change affect operating income?

• A)It will go up by $500.
• B)It will go up by $1,500.
• C)It will go down by $2,500.
• D)It will stay the same.

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Definitions:

Uniform Commercial Code

A comprehensive set of laws governing all commercial transactions in the United States, intended to harmonize the law of sales and other commercial transactions across states.

Interstate

Refers to activities, agreements, or commerce that occur or are conducted between two or more states.

Express Contract

A contract where the terms of the agreement are explicitly stated in words, whether oral or written.

Implied in Fact Contract

An agreement formed by actions and conduct of the parties involved, rather than written or spoken words.