What is the breakeven point for this new process

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Reference no: EM13969006

Mikey W. Smitty is confident that demand for his “Western Rap” CD will substantially exceed the breakeven point computed in Problem 6-3. So, Mikey is contemplating having his CD cut at a classier (and pricier) studio. The cost to record the CD would rise to $9000. However, since this new studio works with very high volume, production costs would fall to $2 per CD.

a. What is the breakeven point for this new process?

b. Compare this process to the process proposed in the previous problem.

Reference no: EM13969006

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