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Answer the following questions using the information below:
Ruben intends to sell his customers a special round-trip airline ticket package. He is able to purchase the package from the airline carrier for $150 each. The round-trip tickets will be sold for $200 each and the airline intends to reimburse Ruben for any unsold ticket packages. Fixed costs include $5,000 in advertising costs.
-How many ticket packages will Ruben need to sell in order to achieve $60,000 of operating income?
Price Floor
A government or group-imposed price control or limit on how low a price can be charged for a product, service, or commodity, usually intended to ensure fair conditions for producers.
Shortage/Surplus
A market condition where the quantity demanded exceeds the quantity supplied (shortage) or where the quantity supplied exceeds the quantity demanded (surplus).
Price Floor
A price floor is a government- or group-imposed price control or limit on how low a price can be charged for a product, often above the equilibrium price.
Shortage/Surplus
Economic conditions where the quantity of a good demanded exceeds its supply (shortage) or where supply exceeds demand (surplus).
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