Jane Westerlund Owns a Picture-Framing Store,The Caplow Co

question 297

Multiple Choice

Jane Westerlund owns a picture-framing store,The Caplow Co.The average price she receives for a framed picture is $120.This price must cover her costs for a typical framed picture,which consists of $5 for glass,$2 for matting,$13 for the frame,and $30 for the labor involved.She must also cover monthly expenses of $1,000 for rent and insurance,$200 for heat and electricity,$500 for advertising,and $3,500 for her salary.Westerlund is considering buying an automatic matte-cutting machine in order to reduce the number of hours of direct labor required to produce a framed picture.In considering this purchase,she should recognize that this purchase will __________ Caplow's variable cost and __________ Caplow's fixed cost.

• A)decrease;increase
• B)decrease;decrease
• C)increase;decrease
• D)increase;increase
• E)have no effect on;decrease

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Definitions:

Cultural Values

The core principles and standards shared by a group that influence behaviors and beliefs within that society.

Personal Values

Fundamental beliefs that guide and motivate attitudes and actions, shaping an individual's behavior and perceptions.

Individualism

A social theory advocating the freedom, rights, or independent action of the individual.

Life Review

A process, often used in therapy, where individuals reflect upon their lives, significant events, and relationships, typically to gain insight or resolve issues.