How many units have to sell in order to turn a profit

Reference no: EM13236599

In the aftermath of a hurricane, an entrepreneur took a one-month leave of absence(with out pay) from her $4000 per month job in order to operate a kiosk that sold fresh drinking water. During the month she operated this venture the entrepreneur paid the government $2000 in kiosk rent and purchased water from a local wholesaler at a price of $1.23 per gallon.

Write an equation that summarizes the cost function for her operation, as well as equations that summarize the marginal, average variable, average fixed, and average total costs of selling fresh drinking water at the kiosk.

If consumers were willing to pay $2.00 to purchase each gallon of fresh drinking water, how many units did she have to sell in order to turn a profit? Explain carefully.

Reference no: EM13236599

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