Problema Solution
A restaurant has fixed costs of $141.25 per day and an average unit cost of $4.75 for each meal served. If a typical meal costs $6, how many customers must eat at the restaurant each day for the owner to break even?
Answer provided by our tutors
for profit per meal, we use:
6 - 4.75 = 1.25
let 'x' represent the number of meals served, then we have a linear equation for total daily cost, 'P':
P = 1.25x - 141.25
for the owner to break even, P=0, and the number of meals that must be served:
0 = 1.25x - 141.25
solving for 'x' we have x=113
the restaurant must serve 113 meals in order to break even