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A group of venture investors is considering putting money into Lemma Books, which wants to produce a new reader for electronic books. The variable cost
A group of venture investors is considering putting money into Lemma Books, which wants to produce a new reader for electronic books. The variable cost per unit is estimated at $200, the sales price would be set at twice the VC/unit, or $400, and fixed costs are estimated at $900,000. The investors will put up the funds if the project is likely to have an operating income of $500,000 or more. What sales volume would be required in order to meet the minimum profit goal? (Hint: Use the break-even formula, but include the required profit in the numerator.) a. 7,000 b. 1,250 c. 2,500 d. 3,500 O e. 4,500
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