Learning Activity $-$ Global Break$-$Even Analysis

Location Annual Fixed Cost Unit Variable Cost per unit

USA $$1\mathrm{.}500\mathrm{.}000$ $$8,50$

Mexico $$2\mathrm{.}040\mathrm{.}000$ $$7,50$

China $$1\mathrm{.}790\mathrm{.}000$ $$6,75$

Forecasted annual sales of first $5$ years $=195\mathrm{.}000$

Question #$1$:

Location Options

USA Mexico China

Total Cost

Question #$2$:

Does your visual inspection of the graph match the minimum cost above?

$($yes$/$no$)$

Question #$3$:

Visually, what do you estimate the Break$-$Even Point to be between the best $2$ options?

$($Future Sales, units$)$

Question #$4$:

Compute the exact Break$-$Even Point.

$($Future Sales, units$)$