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A manufacturer sells his product at $23 per unit, selling all he produces. His fixed cost is $18,000 and his variable cost per unit is $18.50. The level of production at which the manufacturer breaks even
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27 votes
27 votes
A manufacturer sells his product at $23 per unit, selling all he produces. His fixed cost is $18,000 and his variable cost per unit is $18.50. The level of production at which the manufacturer breaks even is

User Nicholas Kinar
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1 Answer

16 votes
16 votes

Answer:

4000 Units

Step-by-step explanation:

x = number of units made and sold

C(x) = cost

C(x) = 18.50x+18000

R(x) = revenue

R(x) = 23x

Breakeven point occurs when the cost and revenue are the same, which produces a profit of 0 dollars.

R(x) = C(x)

23x = 18.50x+18000

23x-18.50x = 18000

4.50x = 18000

x = 18000/(4.50)

x = 4000

User Dilani
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