Benjamin company had the following results of operations for the past year:

sales (16,000 units at $9.90) $158,400
direct materials and direct labor $94,400
overhead (20% variable) 14,400
selling and administrative expenses (all fixed) 31,800 (140,600)
operating income $17,800

a foreign company (whose sales will not affect benjamin's market) offers to buy 3,800 units at $7.28 per unit. in addition to variable manufacturing costs, selling these units would increase fixed overhead by $580 and selling and administrative costs by $280. if benjamin accepts the offer, its profits will:

a. increase by $4,560.
b. increase by $27,664.
c. increase by $5,244.
d. decease by $5,244.
e. increase by $3,700.

answer; (10%) commission;

answer; exemplars;

answermarketing metrics;

the answer is "b.the increased supply will create a surplus. "

the essential thought behind price controls is straightforward - utilize the power of law to modify the equilibrium of a market. for instance, the legislature may choose that the steel business needs to survive, and in this way pass a law to set a value floor on steel. this implies all steel sold must offer at or over the floor value, which must be set over the equilibrium cost for it to have any impact. the switch could likewise happen - the administration can choose that steel is excessively costly and set a value roof underneath its equilibrium value, with the goal that all steel must be sold at or beneath that ceiling.