A Company Is Considering Producing a Product for a New

question 42

Multiple Choice

A company is considering producing a product for a new market.The fixed costs required for manufacturing and delivering the product is $50,000.Labor and material costs are estimated to be approximately $25.00 per product.If the product is sold for $35.00 each,the firm's break-even volume would be

• A)50,000 units
• B)5,000 units
• C)2500 units
• D)500 units

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Definitions:

Caveat Emptor

A legal principle that the buyer assumes the risk of quality in a purchase unless protected by warranty.

Sale of Goods Act

Legislation governing the sale of goods, including provisions on the formation of contracts, descriptions of goods, quality, and return policies.

Organically Grown

Refers to food produced without the use of synthetic pesticides, fertilizers, and other non-natural methods.

Sale of Goods Act

Legislation governing the sale of goods that outlines the rights and obligations of the buyer and seller.