Smithson Cutting is opening a new line of scissors for supermarket distribution. It estimates its fixed cost to be $500.00 and its variable cost to be $0.50 per unit. Selling price is expected to average $0.75 per unit.

Smithson Cutting is opening a new line of scissors for supermarket distribution. It estimates its fixed cost to be $500.00 and its variable cost to be $0.50 per unit. Selling price is expected to average $0.75 per unit.

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 7MC

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_{Smithson cutting is opening a new line of scissors for supermarket distribution. Please write the answers clearly I am 60 years old and hard for me to understand thank you. Please write out the steps}

• S7.16
Smithson Cutting is opening a new line of scissors for supermarket distribution. It
estimates its fixed cost to be $500.00 and its variable cost to be $0.50 per unit.
Selling price is expected to average $0.75 per unit.
a. What is Smithson's break-even point in units?
b. What is the break-even point in dollars? PX

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