Question

George’s t-shirt shop produces 5,000 custom printed t-shirts per month. george’s fixed costs are $15,000 per month. the marginal cost per t-shirt is a constant $4. what is his breakeven price? what would be george’s breakeven price if george were to sell 50% more shirts?

Answer 1

Answer: Price is $7 when sale is 5000 and $6 when sale is 7,500 units.

Step-by-step explanation:

`image`

George will breakeven when his price is just sufficient to cost the total cost.

`image`

If George sells 50% more, then his sales is 7,500 units.

`image`

George will breakeven when his price is just sufficient to cost the total cost.

`image`

When sales is 5000 units price is $7. When sales is 7,500 units price is $6.