Ranbow Inc

question 63

Multiple Choice

Ranbow Inc.is about to introduce a new LED clock and has determined that it will charge $35 per clock. The firm must decide whether or not to purchase a high-capacity clock-making machine. If the high-capacity machine is selected, then the fixed costs for the firm will be $4,000 per year, with variable costs of $6 per clock. Otherwise the fixed costs will be $800, with variable costs of $16 per clock. Above what level of expected sales should Ranbow Inc. choose the high fixed cost alternative to maximize pretax operating cash flow?

• A) 320 units
• B) 352 units
• C) 3200 units
• D) 500 units

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Definitions:

Cortex

The outer layer of the cerebrum in the brain, involved in high-level functions such as sensory perception, cognition, and motor control.

Thalamus

A structure in the brain that relays motor and sensory signals to the cerebral cortex.

Gene Methylation

A chemical modification of DNA that can affect gene expression, often by silencing genes, and plays a role in cellular differentiation and disease.

Prenatal Stress

Refers to stress experienced by a pregnant individual, which can impact fetal development and result in long-term effects on the child.