|- You have the opportunity to invest in one of two companies. Company X has fixed cost of $10 000 000 and variable costs of $5 per unit. Company Y's fixed costs are only $6 000 000, But it has variable costs of $6 per unit. Both companies sell their product for $7.5 each. 1. Compute the total cost and total revenue for each company? 2. Find the break-even point for each company? 3. Draw the break-even chart?

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
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|- You have the opportunity to
invest in one of two
companies. Company X has
fixed cost of $10 000 000 and
variable costs of $5
Company Y's fixed costs are
only $6 000 000, But it has
variable costs of $6 per unit.
Both companies sell their
product for $7.5 each.
1. Compute the total cost and
total revenue for each
per
unit.
company?
2. Find the break-even point
for each company?
3. Draw the break-even chart?
4. Which company do you
choose to invest your
money in? Why?
450
400
Transcribed Image Text:71% |- You have the opportunity to invest in one of two companies. Company X has fixed cost of $10 000 000 and variable costs of $5 Company Y's fixed costs are only $6 000 000, But it has variable costs of $6 per unit. Both companies sell their product for $7.5 each. 1. Compute the total cost and total revenue for each per unit. company? 2. Find the break-even point for each company? 3. Draw the break-even chart? 4. Which company do you choose to invest your money in? Why? 450 400
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