Answer:
no of unit is 17941
Explanation:
given data
fixed cost = $338,000
variable cost = $143 per unit
fixed cost = $1,244,000
variable cost = $92.50 per unit
solution
we consider here no of unit is = n
so here total cost of labor will be sum of fix and variable cost i.e
total cost of labor = $33800 + $143 n ..........1
and
total cost of capital intensive = $1,244,000 + $92.5 n ..........2
so here in both we prefer cost of capital if cost of capital intensive less than cost of labor
$1,244,000 + $92.5 n < $33800 + $143 n
solve we get
n >
n > 17941
and
cost of producing less than selling cost so here
$1,244,000 + $92.5 n < 197 n
solve it we get
n >
n > 11904
so in both we get greatest no is 17941
so no of unit is 17941
