Ingrid is planning to expand her business by taking on a newlroduct that costs $5.91....

Ingrid is planning to expand her business by taking on a new lroduct that costs $5.91. In order to market this new product, $1354.00 must be spent on advertising. The suggested retail price for the product is $12.65. Answer each of the following questions.

a) If a price is $14.18 is chosen, the number of units she needs to sell to break even is? Round up to the nearest whole number

b) If advertising is increased to $1518.00 and the price is kept at $12.65, the number of units she needs to break even is?

Expert Solution

A. Break even units= (fixed cost/(sales price - variable cost)

= 1354/(14.18-5.91)

= 163.724 units

B. Break even units= 1518/(12.65-5.91)=225.22 units

jeff jeffy answered 1 year ago

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