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What is the value of the variable cost ?

If the break even point is $ 130, the fixed cost is $ 330, selling price per unit is $ 25.
(3 marks)

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asked by wilson
  1. For the cost, we know that if there are n items, and each costs c, then the total cost is 330+nc

    For the revenue, if there are n items selling at price 25, the total revenue is 25n.

    So, just set things up to total revenue = total cost

    Not sure what your "break even" point means. Can't be the cost (always more than 330), nor the price (which you say is 25), nor the profit (which is zero at break-even). Anyway, maybe this will get you started.

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    posted by Steve

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