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NEW QUESTION: 1
A DVD manufacturer is considering shutting down its production facility and only selling its movies through digital downloads. The company has signed a contract to pay $3,000 a month for its production facility for the next three years. If the company continues to sell its movies as DVDs, it is projected to earn $8,500 in revenue and spend $3,500 in variable costs each month. Variable costs for the digital downloads are 0. Under what circumstances should the company switch to selling digital downloads?
A. If the demand for movies is expected to decrease in the future
B. If the projected revenue from the digital downloads is more than $2,000 per month
C. If each digital download would earn more profits than each DVD sale
D. If the projected revenue from the digital downloads is more than $5,000 per month
Answer: D

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