Your Uncle Is Considering Investing in a New Company That

question 47

Multiple Choice

Your uncle is considering investing in a new company that will produce high quality stereo speakers.The sales price would be set at 1.50 times the variable cost per unit;the variable cost per unit is estimated to be $75.00;and fixed costs are estimated at $1,120,000.What sales volume would be required to break even,i.e. ,to have EBIT = zero?

• A) 32,853
• B) 28,075
• C) 28,373
• D) 33,152
• E) 29,867

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Definitions:

Strain Gauge

A sensor whose resistance varies with applied force; it's used in mechanical engineering to measure strain on an object.

Resistance

A measure of the opposition to the flow of electric current in a conductor, usually quantified in Ohms (Ω).

Reed Switch

An electromagnetic switch used to control the flow of electricity in a circuit, operated by an applied magnetic field.

Permanent Magnet

A material that maintains a continuous magnetic field without the need for external power.