Question

She thinks that she might be able to sell the soaps for $4-$5 and wants to have an idea of how many soaps she would need to sell in order to break even. At a selling price of $5, how many units would your client need to sell in order to break even? Select an option from the choices below and click Submit.

Answer 1

3,333 Units

Step-by-step explanation:

BREAK EVEN POINT can be defined as the way in which total cost and total revenue are equal, which can simply means the point in which there is no net gain or net loss.

Total Fixed Cost / Price – Variable Cost

Total Fixed cost $10,000

Price $5

Variable cost 2

Hence:

$10,000 / ($5 - $2)

=$10,000/$3

= 3,333 units.

Therefore the client need to sell 3,333 units in order to break even.