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1. A company is considering opening a new product line. The building being considered will have a monthly lease and utility payment of $3500. Two employees will be hired at $ 15/hr/employee. Each employee will work 120 hrs per month. The average revenue per unit product sold is estimated at $ 100. The variable cost of production of each unit is estimated at $40. a) How many units must be produced each month for the buisness to breakeven? b) How many units must be produced monthly to achieve a monthly profit of $10,000?

1. A company is considering opening a new product line. The building being considered will have a monthly lease and utility payment of $3500. Two employees will be hired at $ 15/hr/employee. Each employee will work 120 hrs per month. The average revenue per unit product sold is estimated at $ 100. The variable cost of production of each unit is estimated at $40. a) How many units must be produced each month for the buisness to breakeven? b) How many units must be produced monthly to achieve a monthly profit of $10,000?

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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1. A company is considering opening a new product line. The building being considered will have a monthly lease and utility payment of $3500. Two employees will be hired at $ 15/hr/employee. Each employee will work 120 hrs per month. The average revenue per unit product sold is estimated at $ 100. The variable cost of production of each unit is estimated at $40. a) How many units must be produced each month for the buisness to breakeven? b) How many units must be produced monthly to achieve a monthly profit of $10,000?
Transcribed Image Text:1. A company is considering opening a new product line. The building being considered will have a monthly lease and utility payment of $3500. Two employees will be hired at $ 15/hr/employee. Each employee will work 120 hrs per month. The average revenue per unit product sold is estimated at $ 100. The variable cost of production of each unit is estimated at $40. a) How many units must be produced each month for the buisness to breakeven? b) How many units must be produced monthly to achieve a monthly profit of $10,000?
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