Use the Following to Answer the Questions Below

question 73

Multiple Choice

Use the following to answer the questions below.
A proposal for implementing a new product line has an annual fixed cost of $60,000, variable cost of $35 per unit of output, and revenue (selling price) of $55 per unit of output.
-Refer to the instruction above. What is the break-even quantity?

• A) 2,000 units per year
• B) 3,000 units per year
• C) 6,000 units per year
• D) 20,000 units per year

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Definitions:

Soviet Union

A former federation of communist states in Eastern Europe and Northern Asia, existing from 1922 until its dissolution in 1991, known officially as the Union of Soviet Socialist Republics (USSR).

Price Signals

Indicators that arise from the fluctuation of prices in a market, guiding economic decisions and resource allocation.

Circular Flow Diagram

An illustration showing the flow of resources from households to firms and of products from firms to households. These flows are accompanied by reverse flows of money from firms to households and from households to firms.

Resource Market

A market where resources (like labor, capital, and land) are bought and sold, allowing businesses to acquire what they need to produce goods and services.