A Certain Location of O'Charley's Restaurant Has Annual Fixed Costs

question 56

Multiple Choice

A certain location of O'Charley's Restaurant has annual fixed costs of $200,000. If an average tab at the restaurant is $60 and the variable costs per tab is $20, how many groups of customers must O'Charley's serve per year in order to break even?

• A)2,000
• B)5,000
• C)10,000
• D)3,333
• E)2,500

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Definitions:

Homeostasis

The tendency of a biological system to maintain stability while adjusting to conditions that are optimal for survival.

Steady State

A condition where the variables (such as temperature, pressure, and volume in a system) are unchanging over time.

Drive-Reduction Theory

A psychological concept suggesting that motivation arises from biological needs that push organisms to seek homeostasis through reducing drives stemming from those needs.

Tension

The physical or emotional strain caused by conflicting or demanding circumstances.