A start-up company, Macrotech, plans to produce a device to translate Morse codeto a written message on a home computer and to send written messages in Morsecode over the airwaves. The device is primarily of interest to ham radio enthusiasts. The president, Ron Lodel, estimates that it would require a $30,000 initialinvestment. Each unit costs him $20 to produce and each sells for $85.a. How many units must be sold in order for the firm to recover its initialinvestment?b. What is the total revenue at the break-even volume?c. If the price were increased to $100 each, find the break-even volume.
A start-up company, Macrotech, plans to produce a device to translate Morse codeto a written message on a home computer and to send written messages in Morsecode over the airwaves. The device is primarily of interest to ham radio enthusiasts. The president, Ron Lodel, estimates that it would require a $30,000 initialinvestment. Each unit costs him $20 to produce and each sells for $85.a. How many units must be sold in order for the firm to recover its initialinvestment?b. What is the total revenue at the break-even volume?c. If the price were increased to $100 each, find the break-even volume.
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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A start-up company, Macrotech, plans to produce a device to translate Morse code
to a written message on a home computer and to send written messages in Morse
code over the airwaves. The device is primarily of interest to ham radio enthusiasts. The president, Ron Lodel, estimates that it would require a $30,000 initial
investment. Each unit costs him $20 to produce and each sells for $85.
a. How many units must be sold in order for the firm to recover its initial
investment?
b. What is the total revenue at the break-even volume?
c. If the price were increased to $100 each, find the break-even volume.
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