A Producer with Only One Product Has Total Fixed Costs

question 187

Multiple Choice

A producer with only one product has total fixed costs of $15,000 per month. In addition, it cost the producer $100 in variable costs to produce each unit of his product (raw materials and direct labor cost) . The producer charges his wholesalers $125 per unit. What is the sales amount to break even?

• A) $70,000
• B) $75,000
• C) $80,000
• D) $85,000
• E) $90,000

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Definitions:

Hypothesis

An initial hypothesis formed from restricted data intended to initiate more detailed exploration.

Study Conduct

The manner in which research or academic studies are performed, emphasizing ethical, reliability, and validity standards.

Scientific Method

A systematic process of inquiry involving observation, experimentation, and analysis to answer questions about the natural world.

Observer Bias

A form of research bias that occurs when a study's observers allow their expectations or beliefs to influence the recording of data or interpretation of outcomes.