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Question 6 of 16 Ali, the CEO of a manufacturing company, decided to expand the product offering of his business to include the manufacture of a specific model automotive unit. To include this product, his business would incur fixed costs of $365,000 per year and variable costs of $6 per unit. He plans to sell each unit for $88. a. Calculate the number of units he would have to manufacture to break even. Round up to the next whole number b. While manufacturing the unit, he realized that an additional fixed cost of $3,000 per year was required, and also realized that to be more competitive in the market he had to drop the selling price by 20%. What is the new break-even volume? Round up to the next whole number

Question 6 of 16 Ali, the CEO of a manufacturing company, decided to expand the product offering of his business to include the manufacture of a specific model automotive unit. To include this product, his business would incur fixed costs of $365,000 per year and variable costs of $6 per unit. He plans to sell each unit for $88. a. Calculate the number of units he would have to manufacture to break even. Round up to the next whole number b. While manufacturing the unit, he realized that an additional fixed cost of $3,000 per year was required, and also realized that to be more competitive in the market he had to drop the selling price by 20%. What is the new break-even volume? Round up to the next whole number

Algebra and Trigonometry (MindTap Course List)
Algebra and Trigonometry (MindTap Course List)
4th Edition
ISBN:9781305071742
Author:James Stewart, Lothar Redlin, Saleem Watson
Publisher:James Stewart, Lothar Redlin, Saleem Watson
Chapter10: Systems Of Equations And Inequalities
Section10.FOM: Focus On Modeling: Linear Programming
Problem 14P
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Question 6 of 16 Ali, the CEO of a manufacturing company, decided to expand the product offering of his business to include the manufacture of a specific model automotive unit. To include this product, his business would incur fixed costs of $365,000 per year and variable costs of $6 per unit. He plans to sell each unit for $88. a. Calculate the number of units he would have to manufacture to break even. Round up to the next whole number b. While manufacturing the unit, he realized that an additional fixed cost of $3,000 per year was required, and also realized that to be more competitive in the market he had to drop the selling price by 20%. What is the new break-even volume? Round up to the next whole number
Transcribed Image Text:Question 6 of 16 Ali, the CEO of a manufacturing company, decided to expand the product offering of his business to include the manufacture of a specific model automotive unit. To include this product, his business would incur fixed costs of $365,000 per year and variable costs of $6 per unit. He plans to sell each unit for $88. a. Calculate the number of units he would have to manufacture to break even. Round up to the next whole number b. While manufacturing the unit, he realized that an additional fixed cost of $3,000 per year was required, and also realized that to be more competitive in the market he had to drop the selling price by 20%. What is the new break-even volume? Round up to the next whole number
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