Answer the Following Questions Using the Information Below:
the SouthAus

question 175

Multiple Choice

Answer the following questions using the information below:
The SouthAus Company manufactures several different products.Unit costs associated with Product ADE108 are as follows:
$$\begin{array} { l r } \text { Direct materials } & \$ 40 \\\text { Direct manufacturing labour } & 8 \\\text { Variable manufacturing overhead } & 12 \\\text { Fixed manufacturing overhead } & 23 \\\text { Sales commissions (2\% of sales) } & 6 \\\text { Administrative salaries } & 9 \underline { 9 } \\\quad \text { Total } & \$ 98\end{array}$$
-What are the fixed costs per unit associated with Product ADE108?

• A)$44
• B)$32
• C)$35
• D)$23

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Definitions:

Price Elasticity

A measure of how much the quantity demanded of a good changes in response to a change in price.

Infinitely Elastic

Describes a perfectly elastic demand or supply curve, where the quantity demanded or supplied changes by an unlimited amount in response to any change in price.

Income Elasticity

A measure of how the demand for a good or service changes in response to changes in income.

Supply Elasticity

The measure of responsiveness of the quantity of a good supplied to a change in its price.