a) What is the fixed cost?

b) What are the Variable Costs? 

c) If the merchandise is very popular among students and they need 2,000 units, what do you predict it would cost, based on the above calculations?

d) If the College of Engineering were to receive an offer from a different producer for a flat rate of $22 per shirt, what would be the breakeven point between the two scenarios? 

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Suppose the College of Engineering is planning to sell merchandise this year. They don't know how many students will be interested or how many will sell, so they've received three quotes for orders of different sizes. Assume the relationship is linear or best fit. Units Cost Quote Small Order Medium Order Large Order Extra Large Order 220 445 900 1500 $5,000 $10,000 $18,900 $24,000 Suppose the College of Engineering is planning to sell merchandise this year. They don't know how many students will be interested or how many will sell, so they've received three quotes for orders of different sizes. Assume the relationship is linear or best fit. Units Cost Quote Small Order Medium Order Large Order Extra Large Order 220 445 900 1500 $5,000 $10,000 $18,900 $24,000

Answer rating: 100% (QA)

a To determine the fixed cost we need to find the cost that is not dependent on the number of units ordered In this case we can look at the cost of th... View the full answer