A price regulation that put a price cap on the apartment rents a landlord is permitted to charge leads to underproduction. A monopoly leads to underproduction. The answer is both under productions in the monopoly leads and apartment rent leads.
Answer: keyword analysis
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Answer:
(B) 34400 units
Explanation:
The formula to compute the break even point is shown below:
= (Fixed costs) ÷ (Contribution margin per unit)
where,
Contribution margin per unit = Selling price per unit - Variable expense per unit
= $50 - ($50 × 50%)
= $50 - $25
= $25
And, the fixed cost = $665,000 + $195,000 = $860,000
So, the break even point would be
= ($860,000) ÷ ($25)
= 34,400 units
