Question

A small publishing company is planning to publish a new book. The production costs will include one-time fixed costs (such as editing) and variable costs (such as printing). The one-time fixed costs will total 21499

. The variable costs will be $12
per book. The publisher will sell the finished product to bookstores at a price of 22.75
per book. How many books must the publisher produce and sell so that the production costs will equal the money from sales?

Answer 1

The publisher makes (22.75 -12.00) = 10.75 per book, so to cover the 21,499 fixed cost, must sell
.. 21,499/10.75 = 1999.9
books

Sales revenue will equal production costs when the publisher produces and sells 2000 books.