1.

For a table manufacturing company, selling price for a table is $215.00 per Unit, Variable cost is $21.00 per Unit, rent is $3,815.00 per month and insurance is $216.00 per month. Business wants to expand its business and improve the table quality, it wants to increase the selling price for a table to $344.00 per Unit, Variable cost to $45.00 per Unit, bigger area will have rent $5,326.00 per month and insurance is $341.00 per month At what point will the company be indifferent between the current mode of operation and the new option?

2.

You run a school in Florida. Fixed monthly cost is $5,529.00 for rent and utilities, $5,877.00 is spent in salaries and $1,247.00 in insurance. Also every student adds up to $104.00 per month in stationary, food etc. You charge $671.00 per month from every student now.

You are considering moving the school to another neighborhood where the rent and utilities will increase to $11,526.00, salaries to $6,956.00 and insurance to $2,412.00 per month. Variable cost per student will increase up to $169.00 per month. However you can charge $1,045.00 per student. At what point will you be indifferent between your current mode of operation and the new option?

3. You run a hospital with 100 rooms. Fixed daily cost is $855.00 which includes staff salary, property charges, maintenance etc. Variable cost per room is $15.00 which includes cleaning, equipment rentals, utility cost etc. which is incurred only when the room is full. You charge $75.00 per room per day. You sold 49.00 rooms today, how much profit/loss did you earn for today.