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nika2105 [10]
3 years ago
10

Globe Travel Agency sells Spring Break trips to University of Houston undergraduate students. The fixed cost of Globe is $100,00

0 and its variable cost is $400 for every student who takes the trip Globe offers. The price elasticity of demand is -2.5 at all levels of price. At present, the price of the trip is $600/student and, at this price, demand is 1200 units. Assume that the number of trips sold always equals demand.
Required:
Compute the breakeven quantity at current price, P =$600.
Business
1 answer:
Usimov [2.4K]3 years ago
5 0

Answer:

the breakeven quantity at current price is 500 units

Explanation:

The computation of the  breakeven quantity at current price is shown below:

Breakeven point = Fixed cost ÷ (Price per unit - variable cost per unit)

= $100,000 ÷ ($600 - $400)

 = 500 units

Hence, the breakeven quantity at current price is 500 units

We simply used the above formula so that the correct units could arrive

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a. True

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Therefore the given statement is true

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4 years ago
To sum up international trade theory, we can say that the primary reason for trade is
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The primary reason for trade is for the economic development of a country.

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An Illinois consulting firm had accounts receivable of $70,000 on December 31, 2015. During year 2016, the consulting firm colle
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