Bob's variable costs are $7 per unit. His selling price is $9 per unit. His break-even point is 25 000 units.
-suppose that Bob is able to make some changes to his business by increasing his original selling price by $0.50 per unit, decreasing his variable costs by $0.50 per unit and increasing his fixed costs by $10 000.
a. What is Bob's new break-even point in units?
b. What is Bob's profit when he sells 30 000 units?
c. Assuming Bob believes he can sell 30 000 units, should Bob make the changes to his business?

Question

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The Answer of Bob's variable costs are $7 per unit. His selling price is $9 per unit. His break-even point is 25 000 units.
-suppose that Bob is able to make some changes to his business by increasing his original selling price by $0.50 per unit, decreasing his variable costs by $0.50 per unit and increasing his fixed costs by $10 000.
a. What is Bob's new break-even point in units?
b. What is Bob's profit when he sells 30 000 units?
c. Assuming Bob believes he can sell 30 000 units, should Bob make the changes to his business?

Bob's Variable Costs Are $7 Per Unit