Homework Answers
1.
D
Working note:
Profit = Total revenue - total variable cost - total fixed cost = 300000 - 60%*300000 - 200000
Profit = -$80000
So, it is a loss of $80000.
--------
2.
A
Standard cost is a planned cost, so it is planned in advance of the actual work done.
-------------
3.
A
To maximize the revenue,MR = 0
For that,
MR = 70-.4D = 0
D = 70/.4
D = 175
-----------
4.
B
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