Suppose You Are the Owner of a Picture Frame Store

question 154

Multiple Choice

Suppose you are the owner of a picture frame store and you wish to calculate how many pictures you must sell to cover your fixed and variable costs at a given price.Let's assume that the demand for your pictures is strong,so the average price customers are willing to pay for each picture frame is $120.Also,suppose your fixed costs (FC) total $32,000 (real estate taxes,interest on a bank loan,etc. ) and unit variable cost (UVC) for a picture frame is $40 (labor,glass,frame,and matting) .What is the quantity of picture frames you will need to sell to break-even?

• A)200 picture frames
• B)400 picture frames
• C)800 picture frames
• D)1,600 picture frames
• E)2,000 picture frames

Recognize the importance of creativity and innovation in organizational success.

Understand the role of intrinsic and extrinsic motivation in creativity and innovation.

Identify strategies to increase innovation within an organization.

Recognize the challenges and risks associated with innovation.

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Definitions:

Maximize Profits

The process of increasing the difference between total revenue and total cost to the highest possible level.

Productivity Increase

A rise in the output of goods and services produced per unit of input, often due to improvements in technology, processes, or efficiency.

Marginal Revenue Product Curve

A graph showing the additional revenue generated by employing one more unit of a resource.

Factor of Production

An input used in the production of goods or services, such as labor, land, capital, and entrepreneurship.