A Company Has Two Different Products That Are Sold in Different

question 155

Multiple Choice

A company has two different products that are sold in different markets.Financial data are as follows:

Assume that fixed costs of $2000 could be eliminated if Product B was dropped.Assume furthermore that dropping one product would not impact sales of the other.If Product B is dropped,what would be the impact on total operating income of the company?

• A)increases by $2000
• B)increases by $2500
• C)increases by $500
• D)increases by $2100

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Definitions:

Congressional Ban

A congressional ban is a prohibition or restriction imposed through legislation passed by the U.S. Congress.

Lobbying

The act of attempting to influence the actions, policies, or decisions of officials in their professional capacity, typically by interest groups or individuals.

Unintended Consequences

Outcomes that are not the ones foreseen or intended by a purposeful action, often contrary to what was originally planned.

Interest Group

An interest group is an organization that advocates for specific policies or issues, seeking to influence public policy and decision-making.