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A company manufactures and sells blank audiocassette tapes. The weekly fixed cost is ​$10,000 and it costs ​$0.40 to produce each tape. The selling price is ​$2 per tape. How many tapes must be produced and sold each week for the company to have a profit?

Respuesta :

Answer:

6251 tapes

Explanation:

Given: fixed cost is ​$10,000.

           Variable cost is $0.40 to produce each tape.

            Selling price is $2 per tape.

Lets assume number of tapes to be produced and sold be "x"

We know, Total cost= [tex]Fixed\ cost+ Variable\ cost[/tex]

∴ Total cost= [tex]10000+ 0.40\times x[/tex]

Total cost= [tex]10000+0.40x[/tex]

As given, selling price is $2 per tape.

∴ For attaining break even point, Tota cost = Selling price.

[tex]10000+0.40x= 2x[/tex]

Solving the equation to find the value of x

⇒ [tex]10000+0.40x= 2x[/tex]

Subtracting both side by 0.4x

⇒[tex]10000= 1.60x[/tex]

Dividing both side by 1.60

⇒ [tex]x= \frac{10000}{1.60}[/tex]

∴ x= 6250

Hence, number of tapes must be sold and purchased is 6250 to attain break even in the business, however selling one more tapes will get profit is 6251.