4 **Break-even Analysis for Fiber Optic Meters****Problem Statement:**Handheld fiber optic meters with white light polarization interferometry are useful for measuring temperature, pressure, and strain in electrically noisy environments. The fixed costs associated with manufacturing are $720,000 per year. If variable costs are $290 per unit and the company sells 4,600 units per year, at what selling price per unit will the company break even?**Calculation:**The selling price at which the company will break even is determined to be $ [ ] per unit.**Solution Guide:**To find the break-even selling price, use the following steps:1. Identify the fixed costs: $720,000.2. Identify the variable cost per unit: $290.3. Total units sold per year: 4,600.The break-even point occurs when total revenue equals total costs (fixed costs plus total variable costs).\[ \text{Break-even Selling Price} = \frac{\text{Fixed Costs} + (\text{Variable Cost per Unit} \times \text{Total Units Sold})}{\text{Total Units Sold}} \]By substituting the known values into the formula, you can calculate the required selling price per unit to achieve the break-even point.

Breakeven point refers to the situation where the total cost is equal to total revenue.

Handheld fiber optic meters with white light polarization interferometry are useful for measuring temperature, pressure, and strain in electrically noisy environments. The fixed costs associated with manufacturing are $720,000 per year. If variable costs are $290 per unit and the company sells 4600 units per year, at what selling price per unit will the company break even? The selling price at which the company will break even is determined to be $ per unit.

Handheld fiber optic meters with white light polarization interferometry are useful for measuring temperature, pressure, and strain in electrically noisy environments. The fixed costs associated with manufacturing are $720,000 per year. If variable costs are $290 per unit and the company sells 4600 units per year, at what selling price per unit will the company break even? The selling price at which the company will break even is determined to be $ per unit.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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