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APSC 221 Final Exam Questions And
Answers 100% Pass
Working capital refers to the funds required for current assets that are needed for the start-up
and support of operational activities. (T/F) - ANS True
A license fee is an example of an incremental cost. (T/F) - ANS False
One reason why perfect monopolies rarely occur in practice is because:
a) Few products are so unique that substitutes cannot be used.
b) A large number of vendors can supply the same product.
c) Additional suppliers can enter the marker freely
d) People usually stop buying the product before this occurs. - ANS A
Your company must decide what to do with an old pump it purchased 12 years ago. The pump
hasn't been used for two years and is now in storage. You have collected the following data;
Purchase price 12 years ago = $7,000
Storage costs to date = $500
Current price for a new pump = $12,000
Amount offered for the pump two years ago = $1,250
Best estimate of what the pump would bring today = $1,000
, ©EVERLY 2025 ALL RIGHTS RESERVED
What is the opportunity cost associated with this pump?
a) $1,750
b) $1,500
c) $1,000
d) $1,250 - ANS C
An internet provider has a fixed cost of $740 a month and variable costs of $50a month per
subscriber. If the company charges $70 a month for the service, what is the breakeven point for
the company in terms of subscribers per month? (round to nearest whole number) - ANS 37
An index is a dimensionless number that indicates how a cost or price has changed with time
with respect to a base year. (T/F) - ANS True
The power-sizing technique is sometime referred to as a linear model. (T/F) - ANS False
Which technique sums the product of several quantities or components and adds these to any
components estimated directly?
a) Unit technique
b) Power-sizing technique
c) Factor technique
d) Adding technique - ANS C
What does Cn stand for in the index equation?
a) Reference year for which cost is known.
b) Cost or price of the item in reference year.
APSC 221 Final Exam Questions And
Answers 100% Pass
Working capital refers to the funds required for current assets that are needed for the start-up
and support of operational activities. (T/F) - ANS True
A license fee is an example of an incremental cost. (T/F) - ANS False
One reason why perfect monopolies rarely occur in practice is because:
a) Few products are so unique that substitutes cannot be used.
b) A large number of vendors can supply the same product.
c) Additional suppliers can enter the marker freely
d) People usually stop buying the product before this occurs. - ANS A
Your company must decide what to do with an old pump it purchased 12 years ago. The pump
hasn't been used for two years and is now in storage. You have collected the following data;
Purchase price 12 years ago = $7,000
Storage costs to date = $500
Current price for a new pump = $12,000
Amount offered for the pump two years ago = $1,250
Best estimate of what the pump would bring today = $1,000
, ©EVERLY 2025 ALL RIGHTS RESERVED
What is the opportunity cost associated with this pump?
a) $1,750
b) $1,500
c) $1,000
d) $1,250 - ANS C
An internet provider has a fixed cost of $740 a month and variable costs of $50a month per
subscriber. If the company charges $70 a month for the service, what is the breakeven point for
the company in terms of subscribers per month? (round to nearest whole number) - ANS 37
An index is a dimensionless number that indicates how a cost or price has changed with time
with respect to a base year. (T/F) - ANS True
The power-sizing technique is sometime referred to as a linear model. (T/F) - ANS False
Which technique sums the product of several quantities or components and adds these to any
components estimated directly?
a) Unit technique
b) Power-sizing technique
c) Factor technique
d) Adding technique - ANS C
What does Cn stand for in the index equation?
a) Reference year for which cost is known.
b) Cost or price of the item in reference year.
