A small software company invests $24,425 to produce a software package that will sell for $70.Each unit can be produced for $45.84.How many units must be sold to break even?
A)911 units
B)811 units
C)1211 units
D)1011 units
E)1111 units

Question

A small software company invests $24,425 to produce a software package that will sell for $70.Each unit can be produced for $45.84.How many units must be sold to break even? ​
A)911 units
B)811 units
C)1211 units
D)1011 units
E)1111 units

Quizplus · Accepted Answer

To break even, the revenue generated should be equal to the cost incurred. Let "x" be the number of units sold.
So, revenue = 70x
Total cost = 24425 + 45.84x
Now, for break-even, revenue = total cost
70x = 24425 + 45.84x
24.16x = 24425
x = 1011.07
As we cannot sell a fraction of a software package, we need to round up the value of x to the nearest integer. Therefore, the company needs to sell 1011 units to break even.

A Small Software Company Invests $24,425 to Produce a Software