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Question: a plant operation has fixed costs of 1000000 per year...

Question details

A plant operation has fixed costs of $1,000,000 per​ year, and its output capacity is 100,000 electrical appliances per year. The variable cost is $40 per​ unit, and the product sells for $65 per unit.

a. Construct the economic breakeven chart.

b. Compare annual profit when the plant is operating at 85​% of capacity with the plant operation at​ 100% capacity. Assume that the first 85​% of capacity output is sold at ​$65 per unit and that the remaining 15​% of production is sold at ​$45 per unit.

a. Use the line drawing tool to plot the lines that represent the Fixed​ Cost, Total​ Revenue, and Total Costs. Be sure to properly label your lines.

Use the point drawing tool to plot the Breakeven point. Be sure to properly label the point.

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