Question

A company manufactures its product at a cost of $0.50 per item and sells it for $0.85 per item daily overhead is $600 how many items must be manufactured each day in order for the company to break even

Answer 1

so the company has an overhead of $600, usually that involves premises leasing and industrial equipment for the manufacturing of the product, that's cost. The cost to make each item is 50 cents, so if the company produces "x" items, their cost is 0.5x total.

so our cost equation C(x) = 0.5x + 600 <---- items' cost plus overhead.

the company sells the product for 85 cents, so if they sell "x" items, their total revenue or income will be 0.85x.

so our revenue equation is simply R(x) = 0.85x.

as you already know, the break-even point is when.... well, you break even, no losses but no gains either, how much you take in is the same amount that you shelled out, namely R(x) = C(x).

`\bf \stackrel{R(x)}{0.85x}=\stackrel{C(x)}{0.5x+600}\implies 0.35x=600\implies x=\cfrac{600}{0.35} \\\\\\ x\approx 1714.285714285714\implies \stackrel{\textit{rounded up}}{x=1714}`