If a Firm with $49,000 in Fixed Costs Breaks Even

question 49

Multiple Choice

If a firm with $49,000 in fixed costs breaks even on 7,000 units, how many units must the firm sell to earn $30,000 in operating profit?

• A) 30,000 units
• B) 11,286 units
• C) 15,824 units
• D) There is not enough information to determine the unit sales required.

---

Definitions:

Producer Surplus

The difference between what producers are willing to accept for a good or service and what they actually receive.

Trade

The exchange of goods, services, or both between two or more parties, either within a country or between countries.

Consumer Surplus

The difference between the total amount that consumers are willing and able to pay for a good or service relative to what they actually pay.

Producer Surplus

The difference between what producers are willing to sell a good for and the actual price they receive, reflecting the producer's benefit.