If a company can produce and sell 500 units at $10 each and its variable costs are $6 per unit, expected profit using the profit equation will be $2,000.

Question

Quizplus · Accepted Answer

Using the profit equation, the expected profit would be calculated as follows:

Profit = (Price per unit - Variable cost per unit) x Number of units sold
Profit = ($10 - $6) x 500
Profit = $4 x 500
Profit = $2,000

Therefore, the statement is true and the answer is option B - False.

If a Company Can Produce and Sell 500 Units at $10