Dieckman Company Makes a Product with the Following Costs

question 67

Multiple Choice

Dieckman Company makes a product with the following costs: The company uses the absorption costing approach to cost-plus pricing described in the text. The pricing calculations are based on budgeted production and sales of 71,000 units per year.
The company has invested $360,000 in this product and expects a return on investment of 13%.
Direct labor is a variable cost in this company.

-If every 10% increase in price leads to a 12% decrease in quantity sold,the profit-maximizing price is closest to:

• A)$56.40
• B)$130.10
• C)$144.16
• D)$134.03

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Definitions:

Constructive Processing

The active process of creating meaningful interpretations and understandings of experience through integrating new information with existing knowledge.

Reintegration

Involves the process of integrating someone back into society or a specific community, often after a period of isolation, imprisonment, or treatment.

Consolidation

The process by which memories become stable in the brain, transitioning from a short-term to a long-term state.

Ebbinghaus

Hermann Ebbinghaus was a German psychologist known for his pioneering work on memory and learning, including the discovery of the forgetting curve.