Since product has inelastic demand the change in price will lead to minimal or marginal increase in quantity and hence total revenue will be lower than before.
Hence, correct answer is overall unit sales may increase and total revenue will increase. Which is not possible.
Question 4 (1 point Last year the Simple Company sold 10,000 units of a product for...
Bud, Inc. sold 10,000 units for $70/unit of its only product last year. Operating information from last year is shown below: Total Cost Total Manufacturing Costs $440,000 Selling & Administrative Expenses Variable: $ 60,000 Fixed: $ 32,000 Bud management has indicated that manufacturing costs are 50% variable and 50% fixed. Management does not expect a change in the price/cost structure for next year. What percentage of each sale goes toward profit after the breakeven point is reached? If sales increase by $70,000, how...
Help Save & Exit Submit Kuzio Corporation produces and sells a single product. Data concerning that product appear below: Per Unit $130 Percent of Sales 1008 509 Selling price Variable expenses Contribution margin $ 65 The company is currently selling 6,000 units per month. Fixed expenses are $214,000 per month. The marketing manager believes that a $7.200 increase in the monthly advertising budget would result in a 140 unit increase in monthly sales. What should be the overall effect on...
Last year, Small Company sold 10,000 units of its only product. If sales increase by 15% in the current year, how will unit variable cost and unit fixed cost be affected? Unit Variable Cost A) Remains constant B) Increases C) Decreases D) Remains constant E) Remains constant Unit Fixed Cost Remains constant Decreases Remains constant Decreases Increases A. Choice A B. Choice B C. Choice C D. Choice D E. Choice E
Kuzio Corporation produces and sells a single product. Data concerning that product appear below: Per Unit Percent of Sales Selling price $ 130 100 % Variable expenses 65 50 % Contribution margin $ 65 50 % The company is currently selling 4,900 units per month. Fixed expenses are $208,000 per month. The marketing manager believes that a $6,700 increase in the monthly advertising budget would result in a 170 unit increase in monthly sales. What should be the overall effect...
Dybala Corporation produces and sells a single product. Data concerning that product appear below: Per Unit Percent of Sales Selling price $ 125 100 % Variable expenses 75 60 % Contribution margin 50 40 % The company is currently selling 5,320 units per month. Fixed expenses are $240,000 per month. The marketing manager believes that a $7,600 increase in the monthly advertising budget would result in a 330 unit increase in monthly sales. What should be the overall effect on...
Kuzio Corporation produces and sells a single product. Data concerning that product appear below: Selling price Variable expenses Contribution margin Per Unit $ 150 75 $ 75 Percent of Sales 100% 50% 50% The company is currently selling 6,500 units per month. Fixed expenses are $206,000 per month The marketing manager believes that a $6,300 increase in the monthly advertising budget would result in a 100 unit increase in monthly sales. What should be the overall effect on the company's...
Kuzio Corporation produces and sells a single product. Data concerning that product appear below: Percent of Sales 100% 40% Per Unit $130 52 $ 78 Selling price Variable expenses Contribution margin 60% The company is currently selling 5,000 units per month. Fixed expenses are $216,000 per month. The marketing manager believes that a $7,000 increase in the monthly advertising budget would result in a 180 unit increase in monthly sales. What should be the overall effect on the company's monthly...
Kuzlo Corporation produces and sells a single product. Data concerning that product appear below: Selling price Variable expenses Contribution margin Per Unit $150 60 $ 90 Percent of Sales 100% 40% 608 The company is currently selling 7,000 units per month. Fixed expenses are $209,000 per month. The marketing manager believes that a $7100 increase in the monthly advertising budget would result in a 190 unit increase in monthly sales. What should be the overall effect on the company's monthly...
Kuzio Corporation produces and sells a single product. Data concerning that product appear below: Selling price Variable expenses Contribution margin Per Unit $130 78 $ 52 Percent of Sales 100% 60% 40% The company is currently selling 6,800 units per month. Fixed expenses are $180,000 per month. The marketing manager believes that a $8,000 increase in the monthly advertising budget would result in a 200 unit increase in monthly sales. What should be the overall effect on the company's monthly...
Last year Minden Company introduced a new product and sold 25,300 units of it at a price of $98 per unit. The product's variable expenses are $68 per unit and its fixed expenses are $837,000 per year. 1. What was this product's net operating income (loss) last year? 2. What is the product's break-even point in unit sales and dollar sales? 3. Assume the company has conducted a marketing study that estimates it can increase annual sales of this product...