33. Rosetone Retail sells one product with a variable cost of $3.50 per unit. The demand at different prices to be charged is shown below:

Units Demanded Unit Price

10,000 $9

15,000 $8

20,000 $7

25,000 $6

If fixed costs are $42,000, what price should Rosetone charge in order to maximize profits?

A. $9

B. $8

C. $7

D. $6

34. If the required rate of return is greater than the internal rate of return of a potential investment, the company should deem the investment acceptable.(true or false)

35. The more risky a potential investment is, the lower the companys required rate of return will be.(true or false)

36. What is the present value factor for a $4,000 cash outflow that is made today?

A. 0.00

B. Some value greater than 1.00

C. 1.00

D. It depends on the rate of return that is required.

37. Since present value analysis is concerned with cash flows, which of the following is not true?

A. Depreciation is always an incremental cash inflow.

B. Revenues are inflows in the period when the cash is received.

C. Expenses are outflows in the period when they are paid.

D. The salvage value of equipment is considered in the analysis.