Problema Solution
The cost producing a novelty item is the sum of the fix cost of 25 pesos and a variable cost of 10 pesos per piece. The item is sold at 15 pesos per piece.
a. how much will produce 200 items?
b. How much revenue coin it generated?
c. how many items must e sold in order to break even?
Answer provided by our tutors
Cost = fixed cost + variable cost
= 25 + 10*demand
----------------------------------------------------------------------
(a) D=200
cost = 25+ 10*200
=2025 pesos
----------------------------------------------------------------------
(b)
total revenue = price * demand
= 200 * 15 = 3000 pesos
-----------------------------------------------------------------
(c) breakeven
total revenue = total cost
15*demand = 25 + 10*demand
5*demand=25
demand= 5