Answer:
The break-even point in units will increase by 400 units.
Explanation:
Giving the following information:
Fixed costs= $60,000
Selling price= $4.00
Unitary variable cost= $1
First, we need to calculate the current break-even point for the current situation.
Break-even point in units= fixed costs/ contribution margin per unit
Break-even point in units= 6,000 / (4 - 1)
Break-even point in units= 2,000 units
<u>Now, the unitary variable cost is $1.5</u>
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Break-even point in units= 6,000 / (4 - 1.5)
Break-even point in units= 2,400 units
The break-even point in units will increase by 400 units.