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A tool manufacturer has fixed costs of $124.00 a day. It costs $1.00 to make a screwdriver. The company gets $3.00 per screwdriver sold. How many screwdrivers must be produced daily to break even?

 Aug 24, 2018
 #1
avatar+391 
+2

The profit of the screwdriver is \($2.00\), and we need to sell enough screwdrivers to make a profit of \($124.00\). We can solve this by doing \(\frac{124}{2} = 62\). So you need to have \(62\) screwdrivers produced.

 

- Daisy

 Aug 24, 2018
 #2
avatar+101161 
+1

Thanks, Daisy.....!!!...here's another way to see this

 

Break-even point is where  Costs  = Revenue

Let the number of screwdrivers that need to be sold  = S

 

So...Total  Costs = 124  +  1S

Total Revenue  = 3S

 

Set these even

 

124 + 1S  = 3S     subtract 1S from both sides

124  = 2S    divide both sides by 2

62  =  S   ⇒   62 screwdrivers must be sold to break even

 

 

cool cool cool

 Aug 24, 2018

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