# If fixed costs increase but variable cost and price

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Chapter 11 / Exercise 16
Exploring Microeconomics
Sexton
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99) If fixed costs increase, but variable cost and price remain the same, the break-even point A) decreases. B) increases. C) remains the same. D) may increase or decrease depending on sales. Answer: B
Diff: 2 Page Ref: 12 Section Heading: Model Building: Break-Even Analysis Keywords: break-even analysis AACSB: Analytic skills 100) EKA manufacturing company produces part #2206 for the aerospace industry. Each unit of part #2206 is sold for \$15. The unit production cost of part #2206 is \$3. The fixed monthly cost of operating the production facility is \$3000. How many units of part #2206 have to be sold in a month to break even? C
Diff: 2 Page Ref: 9 Section Heading: Model Building: Break-Even Analysis Keywords: break-even analysis AACSB: Analytic skills 101) EKA manufacturing company produces part #2206 for the aerospace industry. The unit production cost of part #2206 is \$3. The fixed monthly cost of operating the production facility is \$3000. Next month's demand for part #2206 is 200 units. How much should the company charge for each unit of part #2206 to break even? C
Diff: 2 Page Ref: 9 Section Heading: Model Building: Break-Even Analysis Keywords: break-even analysis AACSB: Analytic skills You can buy the complete file from
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Chapter 11 / Exercise 16
Exploring Microeconomics
Sexton
Expert Verified
You can buy the complete file from 102) A bed-and-breakfast breaks even every month if they book 30 rooms over the course of a month. Their fixed cost is \$6000 per month and the revenue they receive from each booked room is \$180. What is their variable cost per occupied room? D Diff: 3 Page Ref: 9
Section Heading: Model Building: Break-Even Analysis Keywords: break-even analysis AACSB: Analytic skills 103) Administrators at a university will charge students \$150 to attend a seminar. It costs \$3000 to reserve a room, hire an instructor, and bring in the equipment. Assume it costs \$25 per student for the administrators to provide the course materials. How many students would have to register for the seminar for the university to break even? A) 18 B) 20 C) 24 D) 30 Answer: C Diff: 2 Page Ref: 9
Section Heading: Model Building: Break-Even Analysis Keywords: break-even analysis AACSB: Analytic skills 104) A university is planning a seminar. It costs \$3000 to reserve a room, hire an instructor, and bring in the equipment. Assume it costs \$25 per student for the administrators to provide the course materials. If we know that 20 people will attend, what price should be charged per person to break even? C
Diff: 2 Page Ref: 9 Section Heading: Model Building: Break-Even Analysis Keywords: break-even analysis AACSB: Analytic skills You can buy the complete file from
You can buy the complete file from