Question 6 of 16 Ali, the CEO of a manufacturing company, decided to expand the product offering of his business to include the manufacture of a specific model automotive unit. To include this product, his business would incur fixed costs of $365,000 per year and variable costs of $6 per unit. He plans to sell each unit for $88. a. Calculate the number of units he would have to manufacture to break even. Round up to the next whole number b. While manufacturing the unit, he realized that an additional fixed cost of $3,000 per year was required, and also realized that to be more competitive in the market he had to drop the selling price by 20%. What is the new break-even volume? Round up to the next whole number
Question 6 of 16 Ali, the CEO of a manufacturing company, decided to expand the product offering of his business to include the manufacture of a specific model automotive unit. To include this product, his business would incur fixed costs of $365,000 per year and variable costs of $6 per unit. He plans to sell each unit for $88. a. Calculate the number of units he would have to manufacture to break even. Round up to the next whole number b. While manufacturing the unit, he realized that an additional fixed cost of $3,000 per year was required, and also realized that to be more competitive in the market he had to drop the selling price by 20%. What is the new break-even volume? Round up to the next whole number
Advanced Engineering Mathematics
10th Edition
ISBN:9780470458365
Author:Erwin Kreyszig
Publisher:Erwin Kreyszig
Chapter2: Second-order Linear Odes
Section: Chapter Questions
Problem 1RQ
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![Question 6 of 16
Ali, the CEO of a manufacturing company, decided to expand the product offering of his business to include the
manufacture of a specific model automotive unit. To include this product, his business would incur fixed costs of
$365,000 per year and variable costs of $6 per unit. He plans to sell each unit for $88.
a. Calculate the number of units he would have to manufacture to break even.
Round up to the next whole number
b. While manufacturing the unit, he realized that an additional fixed cost of $3,000 per year was required, and also
realized that to be more competitive in the market he had to drop the selling price by 20%. What is the new
break-even volume?
Round up to the next whole number](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F6ae0e9af-571c-41e7-b9b4-6c19b3a69bc8%2Ffed59f88-7de4-4db5-abf9-23d427108ec1%2Fzn23x5v_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Question 6 of 16
Ali, the CEO of a manufacturing company, decided to expand the product offering of his business to include the
manufacture of a specific model automotive unit. To include this product, his business would incur fixed costs of
$365,000 per year and variable costs of $6 per unit. He plans to sell each unit for $88.
a. Calculate the number of units he would have to manufacture to break even.
Round up to the next whole number
b. While manufacturing the unit, he realized that an additional fixed cost of $3,000 per year was required, and also
realized that to be more competitive in the market he had to drop the selling price by 20%. What is the new
break-even volume?
Round up to the next whole number
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