Question

A small plant manufactures riding lawn mowers. The plant has fixed costs of GHC48,000 per day and a variable cost of GHC1,400 per unit produced. The mowers are sold for GHC1,800 each. The cost and revenue functions are in that order and , where is the total number of mowers produced and sold each day. How many units must be manufactured and sold each day for the company to break even?

Answer 1

120

Explanation:

The break-even point is the point where revenue =cost

48,000+ 1400x = 1800x

48000=400x

X=48000/400

X=120

Equilibrium quantity is 120 mowers