Data Concerning Moscowitz Corporation's Single Product Appear Below: Fixed

question 191

Multiple Choice

Data concerning Moscowitz Corporation's single product appear below: Fixed expenses are $375,000 per month. The company is currently selling 8,000 units per month. The marketing manager would like to cut the selling price by $15 and increase the advertising budget by $23,000 per month. The marketing manager predicts that these two changes would increase monthly sales by 3,100 units. What should be the overall effect on the company's monthly net operating income of this change?

• A)decrease of $128,900
• B)increase of $426,500
• C)increase of $8,900
• D)increase of $128,900

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Definitions:

Mores

Norms that carry great moral significance, are closely related to the core values of a cultural group, and often involve severe repercussions for violators.

Law

A system of rules created and enforced through social or governmental institutions to regulate behavior, with its precise definition being a matter of longstanding debate among specialists.

Informal Norms

Unwritten rules and expectations that regulate the behavior of individuals within a society or group, without formal legal enforcement.

Formal Norms

Explicitly defined rules and regulations that guide behavior and maintain social order within a society.