Dreiphosis Corp

question 49

Multiple Choice

Dreiphosis Corp. is in the process of determining whether to purchase a high-capacity machine to make textbooks for the upcoming school year. The high-capacity machine will generate fixed costs of $12,000 per year versus the $3,000 fixed costs of using a low-capacity machine. The variable costs per unit when using the high-capacity machine will be $33. The firm will charge $66 for each textbook and has determined that the high-capacity machine will maximize pretax operating cash flow if sales are greater than 1,000 books. What is the contribution margin under the low-capacity machine scenario?

• A) $41
• B) $24
• C) $32
• D) $46

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Definitions:

Reinforcement

A concept in behaviorism that describes any stimulus which strengthens or increases the probability of a specific response.

Attention

Actively paying attention to a specific part of the environment, while omitting to notice other aspects.

Motor Reproduction

In the context of social learning theory, it refers to the physical ability to replicate the observed actions of a model.

Observational Learning

A learning process whereby individuals acquire new behaviors by watching and imitating others.