PRC-2 · Chapter 2 · Question 17 of 45
A company has a linear cost function of C = 20x + 12,000, where x is the number of units produced. If the selling price is Rs. 35 per unit, at what volume of sales does the company break even?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) 800 units
Explanation
At break-even, total revenue equals total cost: 35x = 20x + 12,000. Subtracting 20x gives 15x = 12,000. Dividing by 15 yields x = 800 units.
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