AchtTre Has Found That Its Pretax Operating Cash Flow Basis

question 35

Multiple Choice

AchtTre has found that its pretax operating cash flow basis break-even number of glasses sold is 550,000 pairs. If each pair is sold for $15 and the variable cost per unit is $10, then what is the amount of AchtTre's fixed costs?

• A) $887,000
• B) $1,558,000
• C) $2,750,000
• D) $1,582,000

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Definitions:

Surplus

The amount by which the quantity of a good or service supplied exceeds the quantity demanded, often leading to a decrease in prices.

Supply Elasticities

A measure of how much the quantity supplied of a good responds to a change in price, indicating the responsiveness of sellers to price changes.

Equilibrium Quantity

The quantity of goods or services supplied and demanded at the market equilibrium price.

Short-Run World Demand

Refers to the total quantity of a good or service that is demanded globally over a short period of time, with at least one factor of production held constant.