Suppose a firm has net income of $100 and a profit margin equal to 14%. If the firm is working at 2/3 capacity, then full capacity sales are:

A) $476
B) $539
C) $714
D) $823
E) $1,071

Profit Margin

A financial metric used to assess a company's profitability by dividing net income by revenue.

Net Income

is the amount of money that remains after all expenses, taxes, and costs have been subtracted from a company's total revenue, also known as the bottom line.

Full Capacity Sales

The maximum potential sales revenue a firm can achieve when operating at total capacity.