Reference: 18_04
a Firm Sells Two Products, a and B

question 82

Multiple Choice

Reference: 18_04
A firm sells two products, A and B. For every unit of A the firm sells, two units of B are sold. The firm's total fixed costs are $1,612,000. Selling prices and cost information for both products follow:
$\begin{array}{rrr}&\text { Unit }&\text { Variables}\\&\text { Sales }&\text { Costs}\\\text { Product}&\text { Price } &\text { per Unit }\\\hline\mathrm{A} & \$ 20 & \$ 8 \\\mathrm{~B} & 24 & 4\end{array}$

-The contribution margin per composite unit is:

• A) $12
• B) $20
• C) $32
• D) $44
• E) $52

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Definitions:

Consumer Protection Act

A set of laws designed to protect the rights and interests of consumers by regulating fair trade, competition, and accurate information in the marketplace.

Collection Agencies

Companies that pursue the collection of debts on behalf of creditors.

Licensed

Having officially received permission from the relevant authorities to perform, conduct, or carry out a particular activity or service.

Sodium Hydroxide

A highly caustic metallic base and alkali salt commonly used in manufacturing and as a chemical reactant.