Question

A software company is releasing one of their products on a CD. The manufacturer charges a $5,500 setup fee and $1.00 per CD. Approximately how many CDs must be produced so that the total cost per CD is $5.50?

A) 1,222 CDs
B) 2,200 CDs
C) 1,571 CDs
D) 5,500 CDs

Answer 1

It is actually 2,200, which is option B. I originally put option A but it said it was incorrect and told m eit was 2,200. I hope i was able to help ;)

Explanation:

Answer 2

Given:
set-up fee 5,500
variable fee 1 per CD.

Cost per CD is $5.50

5.50 - 1= 4.50

5,500 / 4.50 = 1,222 CDs Choice A.

1*1,222 = 1,222
1,222 + 5,500 = 6,722
6,722/1,222 = 5.50