ABC Corporation Makes Mattresses in Three Sizes: Twin,queen and King

question 181

Multiple Choice

ABC Corporation makes mattresses in three sizes: twin,queen and king.Twin mattresses have shown a loss for several years,similar to the operating loss shown below:
None of the fixed cost is avoidable.What will total operating income for the corporation be if twin mattresses are discontinued?

• A) $50,000 loss
• B) $15,000 loss
• C) $30,000 profit
• D) $105,000 profit

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Definitions:

Social Desirability Bias

The inclination of individuals to respond to queries in a way that they believe will be positively perceived by others.

Confederate

An individual who participates in a psychological experiment by pretending to be a subject but in reality works for the researcher.

70th Percentile

A value below which 70 percent of the data falls, used as a measure to understand the distribution of data in a set.

High Calorie

Referring to food or beverages that are dense in calories, often implying a higher potential for weight gain.