A Company Has Total Fixed Costs of $200,000 and a Contribution

question 59

Multiple Choice

A company has total fixed costs of $200,000 and a contribution margin ratio of 20%.The total sales necessary to break even are

• A) $800,000.
• B) $1,000,000.
• C) $250,000.
• D) $240,000.

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Definitions:

Permutation

An arrangement of items in a particular order, often used in mathematics to describe all the possible orders a set of objects can be arranged.

Decision Variable Range

The set of possible values that a decision variable can take in mathematical modeling and optimization problems.

Decision Variables

Variables in a mathematical model that decision-makers control in order to achieve the best solution to an optimization problem.

Constraint Function

Mathematical equations that express the limitations or requirements that must be satisfied in an optimization problem.