
Concept explainers
a.
To find: the approximate break-even point for buying mug and refills in comparison to buying drinks in disposable cups.
a.

Answer to Problem 35E
7
Explanation of Solution
Given information:
Refill price = 50¢ = $ 0.5
Cost of 16-ounce drinks in mug = $2.95
Cost of 16-ounce drinks in disposable cups = $0.85
Calculation:
Let the amount of total cost of soft drinks and number of refills of 16-ounce drinks be D and x respectively.
The equation for refill offer will be as follows:
The equation for disposable offer will be as follows:
Put the value of D in equation (1) and simplify as follows:
Therefore, the break-even point is 7.
b.
To explain: the meaning of break-even point and determines the best offer.
b.

Answer to Problem 35E
The meaning of break-even point is that during that earth day week, the amount of buying 16 ounce drinks in either offer is equal.
Both the offers are same.
Explanation of Solution
Given information:
Refill price = 50¢ = $ 0.5
Cost of 16-ounce drinks in mug = $2.95
Cost of 16-ounce drinks in disposable cups = $0.85
Calculation:
The meaning of break-even point in part (a) is that during that earth day week, the amount of buying 16 ounce drinks in either offer is equal.
If someone is having a drink daily, the both offers are equal, that is offered in 7 days in an earth week.
Therefore, both the offers are same.
c.
To find: the best offer if the offer extends for a year.
c.

Answer to Problem 35E
The offer for refillable mug will be better in case the offer is extended for a year.
Explanation of Solution
Given information:
Refill price = 50¢ = $ 0.5
Cost of 16-ounce drinks in mug = $2.95
Cost of 16-ounce drinks in disposable cups = $0.85
Break-even point is 7.
Offer valid for 1 year.
Calculation:
If the offer for refillable mug will be extended for a year, then this offer will be by far better than disposable cup offer. The two offers are equal in case of break-even point.
At points lower than 7, the offer for disposable cup is better but at points higher than 7, it is better to go for the refillable mug offer because in one year, one would buy drinks more than 7 times.
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