Bluebird Mfg

question 105

Multiple Choice

Bluebird Mfg. has received a special one-time order for 15,000 bird feeders at $3 per unit. Bluebird currently produces and sells 75,000 units at $7.00 each. This level represents 80% of its capacity. These bird feeders would be marketed under the wholesaler's name and would not affect Bluebird's sales through its normal channels. Production costs for these units are $3.50 per unit, which includes $2.25 variable cost and $1.25 fixed cost.
- If Bluebird accepts this additional business, the incremental revenue will be:

• A) $33,750.
• B) $38,750.
• C) $45,000.
• D) $11,250.
• E) $7,500.

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Definitions:

Deciders

Individuals or groups within an organization who have the authority to make final purchasing decisions.

Gatekeepers

Individuals or entities that control access to something, often information or resources.

Buying Center

A group of individuals within an organization who are involved in the process of making purchasing decisions.

IT Managers

Professionals responsible for overseeing and managing the information technology (IT) needs and infrastructure within an organization.