An industrial manufacturing fim can produce up to 250 units per week of a machine tool; the selling price is $20 per unit. As discussed in class, draw linear cost and revenue functions to illustrate the optimization problem faced by the firm. The variable costs per unit are $12 and the weekly fixed cost is $1200. Calculate the Break-Even Volume (number of units) for this enterprise; in addition, what will happen to the firm's profit or loss figure if weekly sales are only 120 units?
An industrial manufacturing fim can produce up to 250 units per week of a machine tool; the selling price is $20 per unit. As discussed in class, draw linear cost and revenue functions to illustrate the optimization problem faced by the firm. The variable costs per unit are $12 and the weekly fixed cost is $1200. Calculate the Break-Even Volume (number of units) for this enterprise; in addition, what will happen to the firm's profit or loss figure if weekly sales are only 120 units?
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter9: Decision Making Under Uncertainty
Section: Chapter Questions
Problem 46P
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![An industrial manufacturing firm can produce up to 250 units per week of a machine tool; the
selling price is $20 per unit. As discussed in class, draw linear cost and revenue functions to
illustrate the optimization problem faced by the firm. The variable costs per unit are $12 and the
weekly fixed cost is S1200. Calculate the Break-Even Volume (number of units) for this
enterprise; in addition, what will happen to the firm's profit or loss figure if weekly sales are
only 120 units?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Feac3ba10-0303-4f54-a77d-04f39fb2aaa0%2F9107bb66-b532-4eea-a227-099173a4e168%2Fjc2q63b_processed.jpeg&w=3840&q=75)
Transcribed Image Text:An industrial manufacturing firm can produce up to 250 units per week of a machine tool; the
selling price is $20 per unit. As discussed in class, draw linear cost and revenue functions to
illustrate the optimization problem faced by the firm. The variable costs per unit are $12 and the
weekly fixed cost is S1200. Calculate the Break-Even Volume (number of units) for this
enterprise; in addition, what will happen to the firm's profit or loss figure if weekly sales are
only 120 units?
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