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Lance Is Interested in Entering the Catfish Farming Business

Question 91

Multiple Choice

Lance is interested in entering the catfish farming business.He estimates if he enters this business,his fixed costs would be $50,000 per year and his variable costs would equal 30 percent of sales.If each catfish sells for $2,how many catfish would Lance need to sell to generate a profit that is equal to 10 percent of sales?


A) 40,000
B) 41,667
C) 35,000
D) No level of sales can generate a 10 percent net return on sales.

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