Assume a fixed cost of $900, a variable cost of $4.25, and a selling price of $6.00. a. What is the break-even point? (Roundup your answer to the next whole number.) Break-even point units

Marketing
20th Edition
ISBN:9780357033791
Author:Pride, William M
Publisher:Pride, William M
Chapter19: Pricing Concepts
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Assume a fixed cost of $900, a variable cost of $4.25, and a selling price of $6.00.
a. What is the break-even point? (Roundup your answer to the next whole number.)
Break-even point
units
Transcribed Image Text:Assume a fixed cost of $900, a variable cost of $4.25, and a selling price of $6.00. a. What is the break-even point? (Roundup your answer to the next whole number.) Break-even point units
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Break Even Point

The break-even point is indeed the moment at which total cost and total income are equal, indicating that your small firm is not losing money. In other words, you've reached the point in manufacturing where the expenses of production are equal to the product's profits. This is certainly a vital calculation in each and every new firm's business strategy. Potential investors in an establishment want to know not only what kind of return they can expect but also when they will see that return. This seems to be attributed to the reason that some businesses take years to break even, typically losing money in the first several months or even years.

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