4. (a)Calculate the Breakeven point for Triple P Pizza in dollars. Fixed Costs: $1.45 Million Sales Price: $17.00/Pizza Variable costs: $6.75 / pizza (b) If this business would like to start an advertising campaign, which amounts to an increase in variable costs of $1.20/pizza. With no other charges to the base situation, what is the new Breakeven Point in dollars.

4. (a)Calculate the Breakeven point for Triple P Pizza in dollars. Fixed Costs: $1.45 Million Sales Price: $17.00/Pizza Variable costs: $6.75 / pizza (b) If this business would like to start an advertising campaign, which amounts to an increase in variable costs of $1.20/pizza. With no other charges to the base situation, what is the new Breakeven Point in dollars.

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter17: Long-term Investment Analysis

Section: Chapter Questions

Problem 3.4CE

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A recent engineering was given the job of determining the best production rate for a new type of casting in a foundry. After experimenting with many combinations of hourly production rates and total production cost per hour, he summarized his findings in (table 1). The engineering then talked to the firm’s marketing specialist, who provided estimates of selling price per casting as a function of production output (see table 2). There are 8,760 hours in a year. What production rate would you recommend to maximize total profits per year? Table 1 Total cost per hr Casting production per hr $1,000 100 $2,600 200 $3,200 300 $3,900 400 $4,700 500 Table 2 Selling price / casting Casting production per hr $20.00 100 $17.00 200 $16.00…
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