Triangle Manufacturing has fixed costs of $2,000 per week. The firm manufactures tricycle kits. The kits have a short-run average variable cost of $25 and are sold for $35 each.
(i)What is the breakeven level of weekly output for the firm?
(ii)What is the degree of operating leverage when weekly output is Q = 250?

Question

Quizplus · Accepted Answer

The Answer of Triangle Manufacturing has fixed costs of $2,000 per week. The firm manufactures tricycle kits. The kits have a short-run average variable cost of $25 and are sold for $35 each.
(i)What is the breakeven level of weekly output for the firm?
(ii)What is the degree of operating leverage when weekly output is Q = 250?

Triangle Manufacturing Has Fixed Costs of $2,000 Per Week