OceanGate sells external hard drives for $184 each. Its total fixed costs are $27 million, and its variable costs per unit are $120. The corporate tax rate is 40%. If the economy is strong, the firm will sell 8 million drives, but if there is a recession, it will sell only half as many. a. What will be the percentage decline in sales if the economy enters a recession? (Negative value should be indicated by a minus sign. Round your answer to 2 decimal places.) X Answer is complete but not entirely correct. Percentage decline in sales 50.00 % b. What will be the percentage decline in profits if the economy enters a recession? (Negative value should be indicated by a minus sign. Round your answer to 2 decimal places.) Answer is complete but not entirely correct. decline in mrefEt 50.700

OceanGate sells external hard drives for $184 each. Its total fixed costs are $27 million, and its variable costs per unit are $120. The corporate tax rate is 40%. If the economy is strong, the firm will sell 8 million drives, but if there is a recession, it will sell only half as many. a. What will be the percentage decline in sales if the economy enters a recession? (Negative value should be indicated by a minus sign. Round your answer to 2 decimal places.) X Answer is complete but not entirely correct. Percentage decline in sales 50.00 % b. What will be the percentage decline in profits if the economy enters a recession? (Negative value should be indicated by a minus sign. Round your answer to 2 decimal places.) Answer is complete but not entirely correct. decline in mrefEt 50.700

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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