Break-Even Analysis

question 60

Multiple Choice

Break-even analysis. Markovian Caviar Sales has discovered that the extent of the demand for its caviar harvest is 20,000 tins per year. If the fixed costs for the new product are $2,300,000 and the variable harvest cost per tin is $35, then what price can Markovian charge per tin if the company needs to break even on a pretax operating cash flow basis?

• A) $135.00
• B) $150.00
• C) $185.00
• D) None of the above

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Definitions:

Administered Vertical Marketing System

A coordinated marketing system where a single entity of a distribution channel takes the lead in organizing the flow of products or services, without formal agreements or ownership.

Contractual Agreement

A legally binding contract between two or more parties outlining their responsibilities and obligations.

Intensive

Characterized by or requiring significant effort or energy, often in reference to growth strategies or distribution methods.