Shredder Frets, a brand new manufacturer of guitars is looking at what price to charge for it's new burning finger tips line. They want to determine at which selling price they would break-even. They have a manufacturing capacity of 100 guitars. It will cost $500 for materials and labor to make each unit. The fixed costs are $15,000 annually. To break even, Shredder Frets would need to charge $ ______.00 for its guitar.

Shredder Frets, a brand new manufacturer of guitars is looking at what price to charge for it's new burning finger tips line. They want to determine at which selling price they would break-even. They have a manufacturing capacity of 100 guitars. It will cost $500 for materials and labor to make each unit. The fixed costs are $15,000 annually. To break even, Shredder Frets would need to charge $ ______.00 for its guitar.

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter5: Investment Decisions: Look Ahead And Reason Back

Section: Chapter Questions

Problem 5.4IP

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