CIMA Exam CIMAPRO19-P01-1 Topic 4 Question 15 Discussion

Actual exam question for CIMA's CIMAPRO19-P01-1 exam

Question #: 15
Topic #: 4

PL currently earns an annual contribution of $2,880,000 from the sale of 90,000 units of product B. Fixed costs are $800,000 per annum.

The management of PL is considering reducing the selling price per unit to $48. The estimated levels of demand at the revised selling price and the probabilities of them occurring are as follows:

Calculate the probability that the profit will increase from its current level if the selling price is reduced to $48.

AThe probability therefore that the contribution will exceed $2,880,000 is 90%.

BThe probability therefore that the contribution will exceed $2,880,000 is 50%.

CThe probability therefore that the contribution will exceed $2,880,000 is 70%.

DThe probability therefore that the contribution will exceed $2,880,000 is 40%.

Show Suggested Answer

Suggested Answer: A

References:

by Catalina at May 04, 2022, 09:18 PM

Limited Time Offer

25%

Off

Get Premium CIMAPRO19-P01-1 Questions as Interactive Web-Based Practice Test or PDF

Contribute your Thoughts:

Submit Cancel

Currently there are no comments in this discussion, be the first to comment!