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Calculate the break-even point for a manufacturer producing three types of humidifiers: Humidifier Regular (HR), Humidifier Advanced (HA), and Humidifier Simple (HS). Last year, they sold 1000 units of HR, 2000 units of HA, and 10,000 units of HS. Given the respective prices and variable costs for each model, determine the break-even point for the company. Additionally, if the manufacturer reduces the selling price of HR from $60 to $45, expecting an increase in sales volume from 1000 units to 2500 units, what would be the revised break-even point?

User Tai Tran
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Final answer:

Without specific data on selling prices, variable costs, and fixed costs, it is not possible to provide an exact break-even point. The break-even point for various humidifiers is calculated by dividing fixed costs by the contribution margin per unit. Adjusting prices or sales volume will affect the break-even calculation. For profit-maximizing output, find where marginal revenue equals marginal cost.

Step-by-step explanation:

Calculating Break-Even Point and Profit Maximization:

To calculate the break-even point for a manufacturer producing different types of humidifiers, we need to know the selling prices, variable costs, and fixed costs for each product. Unfortunately, these details aren't provided in the problem statement, which makes it impossible to give an accurate break-even point calculation. However, I can explain the concept and the process. The break-even point occurs when total revenue equals total costs (fixed costs plus variable costs). To find the break-even point in units for each product, divide the fixed costs by the contribution margin per unit (selling price minus variable cost per unit).

Regarding the scenario of reducing the selling price from $60 to $45 and increasing sales volume from 1000 units to 2500 units for Humidifier Regular (HR), this would change the contribution margin, which impacts the break-even calculation. You would recalculate the break-even point using the new selling price and projected sales volume. If the contribution margin increases and fixed costs remain stable, the break-even point in units would decrease.

For problem 39's profit-maximizing question, you would look for the output level where marginal revenue equals marginal cost. As the tables and diagrams requested are not provided, this cannot be definitively answered. Similarly, the profit maximizing quantity in problem 40 would be where marginal revenue equals marginal cost, which needs calculation.

User Saulo
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