A Product Sells for $20 Per Unit and Has a Contribution

question 12

Multiple Choice

A product sells for $20 per unit and has a contribution margin ratio of 40 percent.Fixed expenses total $240,000 annually.How many units of the product must be sold to yield a profit of $60,000?

• A)37,500 units
• B)40,000 units
• C)65,000 units
• D)30,000 units

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Definitions:

Efficiency Wages

Wages set above the market equilibrium to increase worker productivity and efficiency.

Unemployment

Describes the situation where individuals who are capable of working and willing to work are unable to find employment.

Market Forces

The economic factors affecting the price, demand, and availability of goods and services in a free market, including competition, supply, and demand.

Discrimination

Unfair treatment of a person or group based on characteristics such as race, gender, age, or religion.