The middle of one-year rental contract

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Reference no: EM131163000

You are a newspaper publisher. You are in the middle of a one-year rental contract for your factory that requires you to pay $700,000 per month, and you have contractual labor obligations of $1,250,000 per month that you can’t get out of. You also have a marginal printing cost of $0.25 per paper as well as a marginal delivery cost of $0.10 per paper. If sales fall by 20 percent from 1,000,000 papers per month to 800,000 papers per month, what happens to the AFC per paper? Instructions: Round your answers to two decimal places. AFC per paper from $ per paper to $ per paper. What happens to the MC per paper? What happens to the minimum amount that you must charge to break even on these costs? Instructions: Round your answers to two decimal places. The amount from $ per paper to $ per paper.

Reference no: EM131163000

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