Victor plans to set up an online business selling software applications that he develops and supports. He believes that a price of $130 for his product including the technical support would be competitive. His monthly fixed expenses amount to $850. Victor would hire some college students to provide the technical support of the application paying them for 3 hours at $15 per hour for each customer. a) Using cost margin analysis, calculate how many customers Victor needs to acquire to break even? Show your calculations. b) If he wants to achieve a target profit of $500 monthly, how many customers does he need? Show your calculations.
Victor plans to set up an online business selling software applications that he develops and supports. He believes that a price of $130 for his product including the technical support would be competitive. His monthly fixed expenses amount to $850. Victor would hire some college students to provide the technical support of the application paying them for 3 hours at $15 per hour for each customer. a) Using cost margin analysis, calculate how many customers Victor needs to acquire to break even? Show your calculations. b) If he wants to achieve a target profit of $500 monthly, how many customers does he need? Show your calculations.
Elementary Geometry For College Students, 7e
7th Edition
ISBN:9781337614085
Author:Alexander, Daniel C.; Koeberlein, Geralyn M.
Publisher:Alexander, Daniel C.; Koeberlein, Geralyn M.
Chapter8: Areas Of Polygons And Circles
Section8.CR: Review Exercises
Problem 40CR: Sue and Daves semicircular driveway is to be resealed, and then flowers are to be planted on either...
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Victor plans to set up an online business selling software applications that he develops and supports. He believes that a price of $130 for his product including the technical support would be competitive. His monthly fixed expenses amount to $850. Victor would hire some college students to provide the technical support of the application paying them for 3 hours at $15 per hour for each customer.
a) Using cost margin analysis, calculate how many customers Victor needs to acquire to break even? Show your calculations.
b) If he wants to achieve a target profit of $500 monthly, how many customers does he need? Show your calculations.
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