Mountain Manufacturing Is Trying to Predict the Cost Associated with Producing

question 100

Multiple Choice

Mountain Manufacturing is trying to predict the cost associated with producing its hiking packs. At a production level of 20,000 packs, Mountain Manufacturing's average cost per pack is $70.00.
-At Mountain Manufacturing if $200,000 of the costs are fixed, and the plant manager uses the cost equation to predict total costs, her forecast for 25,000 packs will be

• A) $1,500,000.
• B) $1,750,000.
• C) $1,400,000.
• D) $1,700,000.

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Definitions:

Competitive Advantage

A condition or circumstance that puts a company in a favorable or superior business position compared to its competitors.

Target Market

A specific group of potential customers at whom a company aims its products or services, based on shared characteristics such as needs, preferences, or demographics.

External Environment

The conditions, entities, events, and factors surrounding an organization that influence its activities and choices, but are out of its direct control.

Cause-and-Effect Relationships

Refers to the principle that one event (the cause) directly leads to the outcome of another event (the effect).