Languages, Inc

question 118

Essay

Languages, Inc. manufactures hand held computers that translate between two languages. Based on their market research, they have developed computers for French/English, German/English, and Spanish/English. The process for making the computers will have fixed costs of $2,000,000 per year and variable costs of $50 per computer. The company believes that it can sell at least 40,000 computers per year.
a) What should the price per computer be if the company wants to break even at a volume of 40,000 computers per year?
b) If they sell 60,000 computers at a price of $90 per computer, what will the contribution to profit be?

---

Definitions:

Price of Capital

The cost of accessing funds or resources for investment purposes, often influenced by interest rates, market demand, and availability of capital.

Occupations

The various types of jobs or professions individuals engage in to earn income.

Percentage Increases

The calculation of the rise in a quantity or value expressed as a percentage of its previous value.

Engineering Professions

Fields of work that apply scientific principles, mathematics, and ingenuity to develop technological solutions and buildings, ranging from civil to electrical engineering.