Question

Jane wants to setup a photo shop. The cost to rent an office is $150 per week. The variable cost of making one photo is $20 and she can sell it for $50.

1.

Jane has to sell _________ photos per week to break even. (Please only enter an integer and include no units.)

2.

If Jane sells 10 units, her profits would be ________ dollars. (Please only enter an integer and include no units.)

Answer 1

1

Breakeven units = fixed cost/(sales price-variable cost)

=150/(50-20)

=5

2

Profit = units*(price-cost)-fixed cost = 10*(50-20) -150=300-150 = 150