Legendary Motors Has 7,000 Defective Autos on Hand,which Cost $12,880,000

question 44

Multiple Choice

Legendary Motors has 7,000 defective autos on hand,which cost $12,880,000 to manufacture.Legendary can either sell these defective autos as scrap for $8,000 per auto,or spend an additional $18,320,000 on repairs and then sell them for $12,000 per unit.What is the net advantage to repair the autos compared to selling them for scrap?

• A)$84,000,000
• B)$18,320,000
• C)$9,680,000
• D)$56,000,000

---

Definitions:

Cartoonists' Labor

The work effort and creativity employed by cartoonists in producing comic strips, animations, or illustrations.

Old Jokes

Humorous statements or stories that have been widely known and circulated over a long period.

Total Costs

The aggregate of all spending related to the creation of goods or services, which includes fixed and variable costs.

Average Variable Costs

The total variable costs divided by the quantity of output produced.