Question: A plant is currently producing 1 0 0 , 0 0 0 piece / year of product. The variable cost ( which is proportional to

A plant is currently producing 100,000 piece/ year of
product. The variable cost (which is proportional to
production rate) is $1,000,000/year. The fixed charges
including overhead and general expenses are
$500,000/year. The plant sells all the product it produces
and is currently making a profit of $300,000/year.
Assume the price of the product does not change, the
break-even production rate in piece/year is:
Hint: You need to find the price per unit first, Revenue =
price/unit \times number of units.
Profit = Revenue - fixed cost - variable cost.
Break-even point means profit is zero.

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