Decide how many machines of certain type to purchase

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Reference no: EM132115126

A manager must decide how many machines of a certain type to purchase. Each machine can process 100 customers per day. One machine will result in a fixed cost of $2,100 per day, while two machines will result in a fixed cost of $3,800 per day. Variable costs will be $20 per customer, and revenue will be $45 per customer.

a. Determine the break-even point for each range. (Round your answers to the next whole number.)

One machine _______________

Two machines _______________

b. If estimated demand is 90 to 120 customers per day, how many machines should be purchased?

Two machines OR One machine

Reference no: EM132115126

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