Question

Markus buys T-shirts at $60 per dozen and sells them at $8 per unit. For his business, Marcus rents a stand in the mall at $120 per month. If Marcus pays the part-time worker who sells T-shirts from this stand $1 for each sold T-shirt, how many T-shirts must Marcus sell during the month to break even?

Answer 1

To break even, Markus must sell 60 T-shirts in a month. This is calculated by dividing his monthly fixed costs by the profit he makes per T-shirt after deducting costs and worker's payment.

Step-by-step explanation:

First, we need to calculate the cost price per T-shirt. If Markus buys T-shirts at $60 per dozen, that means he pays $60 / 12 = $5 per T-shirt. Then, we consider his selling price, which is $8 per unit. Each T-shirt sold gives a profit of $8 (selling price) - $5 (cost price) - $1 (payment to worker) = $2 profit per T-shirt.

Since Markus has a fixed cost for the stand of $120 per month, to break even, he needs to cover this cost with the profit from selling the T-shirts. To find the number of T-shirts he needs to sell, we divide the total fixed costs by the profit per T-shirt: $120 / $2 = 60 T-shirts. Therefore, Markus must sell 60 T-shirts in a month to break even.