Chester Company Plans to Introduce a New Product

question 148

Multiple Choice

Chester Company plans to introduce a new product.A market research specialist claims that 20,000 units can be sold at a $100 selling price.Assuming the company desires a profit margin of 22% of sales,what is the target cost per unit?

• A) $128.21
• B) $78
• C) $80
• D) $20

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Definitions:

Budget Surplus

A situation where a government's revenues exceed its expenditures within a specific period.

Equilibrium Output

The level of output at which the quantity of goods produced equals the quantity of goods consumed, often resulting in market stability.

Short-Run Aggregate Demand

The total amount of goods and services that will be purchased at all possible price levels in an economy in a short period.

Aggregate Supply Curve

A graphical representation showing the relationship between the overall price level in an economy and the total output produced by firms.