A small fast-food restaurant invests $5,951 to produce a new food item that will sell for $3.81.Each unit can be produced for $2.50.How many items must be sold to break even?
A)4543 items
B)4743 items
C)4343 items
D)4643 items
E)4443 items

Question

A small fast-food restaurant invests $5,951 to produce a new food item that will sell for $3.81.Each unit can be produced for $2.50.How many items must be sold to break even? ​
A)4543 items
B)4743 items
C)4343 items
D)4643 items
E)4443 items

Quizplus · Accepted Answer

The break-even point is reached when the total revenue equals the total cost. The total revenue is the selling price per unit multiplied by the number of units sold. The total cost is the cost per unit multiplied by the number of units produced. In this case, the selling price per unit is $3.81, the cost per unit is $2.50, and the total investment is $5,951. So, the break-even point is reached when:3.81x - 2.50x = 5,9511.31x = 5,951x = 4543Therefore, the restaurant must sell 4543 items to break even.

A Small Fast-Food Restaurant Invests $5,951 to Produce a New