Use the following setup for the next question.
A firm is deciding between two different sewing machines.Technology A has fixed costs of $500 and marginal costs of $50 whereas Technology B has fixed costs of $250 and marginal costs of $100.
-If the price is $60 per unit,what is the break even amount of units for technology B?
A)50
B)60
C)70
D)None-They would have to shut down

Question

​Use the following setup for the next question.
A firm is deciding between two different sewing machines.Technology A has fixed costs of $500 and marginal costs of $50 whereas Technology B has fixed costs of $250 and marginal costs of $100.
-​If the price is $60 per unit,what is the break even amount of units for technology B?
A)​50
B)60
C)70
D)​None-They would have to shut down

Quizplus · Accepted Answer

For Technology B to break even, the revenue per unit must at least equal the marginal cost. Since the price per unit is $60 and the marginal cost for Technology B is $100, it is impossible for Technology B to break even because it costs more to produce each unit than the selling price.

​Use the Following Setup for the Next Question

Use the Following Setup for the Next Question