Helping Hands is a nonprofit organization that supplies electric fans during summer for individuals in need.Fixed costs are $225,000.The fans cost $25.00 each.The organization has a budgeted appropriation of $675,000.How many people can receive a fan during summer?
A) 15,000 people
B) 18,000 people
C) 22,000 people
D) 16,000 people

Question

Quizplus · Accepted Answer

To determine how many people can receive a fan during summer, we need to divide the budgeted appropriation by the total cost of the fans (variable cost + fixed cost).

Variable cost per fan = $25.00
Total cost per fan = $25.00 + $0 (no variable costs since it's a nonprofit)

Total cost = Fixed cost + (Variable cost per fan x Number of fans)

675,000 = 225,000 + (25 x Number of fans)

450,000 = 25 x Number of fans

Number of fans = 18,000

Therefore, the organization can supply electric fans to 18,000 individuals in need during summer. The best answer choice is B.

Helping Hands Is a Nonprofit Organization That Supplies Electric Fans