Basics Of Engineering Economy
2nd Edition
ISBN: 9780073376356
Author: Leland Blank, Anthony Tarquin
Publisher: MCGRAW-HILL HIGHER EDUCATION
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Bags
Fixed Cost
Variable Cost
Total Cost
0
$1,700
$ -
$1,700
100
$1,700
$500
$2,200
200
$1,700
$1,200
$2,900
300
$1,700
$2,700
$4,400
400
$1,700
$5,200
$6,900
500
$1,700
$9,000
$10,700
600
$1,700
$15,000
$16,700
700
$1,700
$23,800
$25,500
800
$1,700
$36,800
$38,500
900
$1,700
$55,800
$57,500
1,000
$1,700
$83,000
$84,700
Given the above information on cost, if you charge $15 per entry, what is the the break even quantity of bags? At what quantity of bags will profits be maximized? .
Please select any/all viable approaches below:
Using Qb = F/(MR-AVC) where Qb is the break even quantity, the event would break even at 283 bags>
Using the profit maximizing rule, MR ≥ MC, the quantity of bags that will maximize profits is 200 bags.
Using the profit maximizing rule, MR ≥ MC, the quantity of bags that will maximize profits is 300 bags.…
Fixed cost is $2600, variable cost per unit is $100 and selling price is $60. Find Break Even Point and Total Revenue.
True/false
Variable cost changes or vary with the change in the level of output in a production process.
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- ipants Fixed Cost Variable Cost Total Cost 0 $1,700 $ - $1,700 100 $1,700 $500 $2,200 200 $1,700 $1,200 $2,900 300 $1,700 $2,700 $4,400 400 $1,700 $5,200 $6,900 500 $1,700 $9,000 $10,700 600 $1,700 $15,000 $16,700 700 $1,700 $23,800 $25,500 800 $1,700 $36,800 $38,500 900 $1,700 $55,800 $57,500 1,000 $1,700 $83,000 $84,700 Given the above information on cost, if you charge $15 per entry, what is the breakeven quantity of bags that you should order? At what quantity of bags will profits be maximized? Please select any/all correct responses below: Using Qb = F/(MR - AVC) where Qb is the break even quantity, the event would break even at 283 bags. Using the profit-maximizing rule, MR ≥ MC, the quantity of bags that will maximize profits is 200 bags. Using the profit-maximizing rule, MR > MC, the quantity of bags that will maximize…arrow_forwardWhen the variable cost is reduced for linear total cost and revenue lines, the breakeven point decreases. This is an economic advantage because:a. the revenue per unit will increase.b. the two lines will now cross at zero. c. the profit will increase for the same revenue per unit.d. the total cost line becomes nonlinear.arrow_forwardJenkins Ltd manufactures remote control cars which sells for $500 each. The fixed cost is $70000 and the variable cost per unit is $300. Jenkins sold 200 units of car. Find the total cost and total revenue for Jenkins Ltd.arrow_forward
- impact of fixed and variable cost on break even analysisarrow_forwardA company makes and sells toasters. To make the toasters there is a fixed monthly cost of $27,000 and an additional production cost of $30 per toaster. The toasters sell for $75 each. (a) Write down the cost function. (b) Write down the revenue function. (c) Find the profit function. (d) Find the break even point. (e) How many toasters must the company sell to make a 15% profit?arrow_forwardClassify the cost elements shown below for the Impressive Printing Company into the proper quality cost categories. Cost Element Amount Quality Cost Category Customer complaint remakes $28,300 -Select Printing plate revisions $25,700 -Select- Quality improvement projects -Select- Gauging Select Other waste -Select Correction of typographical errors Proofreading Quality planning Press downtime Bindery waste Checking and inspection $14,900 $98,000 $34,900 $197,000 $400,000 $51,200 Quality Cost Category Prevention Appraisal Internal failure External failure $262,700 $57,000 $31,400 -Select -Select- Total Amount $ $ S $ -Select- -Select Select Select V V Find the total quality cost by category and percentage of total quality cost by category. Do not round intermediate calculations. Round the monetary values to the nearest dollar and percentage values to two decimal places. V Percentage of Total Quality Cost % % % %arrow_forward
- Bags/Participants Fixed Cost Variable Cost Total Cost 0 $1,700 $ - $1,700 100 $1,700 $500 $2,200 200 $1,700 $1,200 $2,900 300 $1,700 $2,700 $4,400 400 $1,700 $5,200 $6,900 500 $1,700 $9,000 $10,700 600 $1,700 $15,000 $16,700 700 $1,700 $23,800 $25,500 800 $1,700 $36,800 $38,500 900 $1,700 $55,800 $57,500 1,000 $1,700 $83,000 $84,700 Given the above information on cost, if you charge $15 per entry, what is the breakeven quantity of bags that you should order? At what quantity of bags will profits be maximized? A Use the profit maximizing rule, MR ≥ MC, buy 300 bags. B Use the profit maximizing rule, MR ≥ MC, buy 200 bags. C Use Qb = F/(MR-AVC) where Qb is the breakeven quantity to be determined, the optimal quantity of bags is 300. D Use Qb = F/(MR-AVC) where Qb is the breakeven quantity to be determined, the optimal quantity of bags is 200.arrow_forwardA company manufactures and sells book-cases .The selling price is $54.90 per book case.The total cost.The total cost function is linear, and cost amounts to $50,000 for 2,000 book-cases and $32,120 for 800 book-cases. (a)Write the equation for revenue.(b)Write the equation for total cost. (c)Find the break even point.arrow_forwardCalculate the missing values. Express dollar values rounded to two decimal places and break-even volumes rounded up to the next integer. Fixed Cost (FC) per month Variable Cost (VC) Selling Price (5) per unit Total Variable Cost at Break- Revenue (TR) even (TVC) per month Break-even Total Volume (x) per month per month at Break-Even per unit $8,700.00 $24.00 $36.00 $0.00 $0.00 $130,000.00 $470.00 1,030 S0.00 $0.00 $0.00 $740.00 $79.00 22 $0.00 50.00 S0.00 $31.00 $53.00 440 S0.00 S0.00 S0.00 -1°Carrow_forward
- Fixed cost Variable cost No. of cupcake Total cost (FC+VC) $420 $2.10 1 $422.10 $420 $42.00 20 $462.00 $420 $84.00 40 $504.00 $420 $126.00 60 $546.00 $420 $168.00 80 $588.00 $420 $210.00 100 $630.00 TC = $420 + 2.1x R= 4.90(x) (I) Graph both functions on the same coordinate axes.(II) From your graph find coordinatae at which cost equals revenue.(III) Using your graph, determine how many cupcakes need to be made to produce revenueof at least $1,029.How much profit is made for this number of cupcakes?arrow_forwardT/F The fixed cost incur at even zero level of output.arrow_forwardI need Answer all part and Definitely Will rate Thank you !:) I highly obliged to you Image is dull but clearly visible Don't skip in blurr image categoryarrow_forward
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