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A producer of felt-tip pens has received a forecast of demand of 39,000 pens for the coming month from its marketing department. Fixed costs of
A producer of felt-tip pens has received a forecast of demand of 39,000 pens for the coming month from its marketing department. Fixed costs of $33,000 per month are allocated to the felt-tip operation, and variable costs are 38 cents per pen.
a. Find the break-even quantity if pens sell for $3 each. (Round your answer to the next whole number.)
b. At what price must pens be sold to obtain a monthly profit of $14,000, assuming that estimated demand materializes? (Round your answer to 2 decimal places. Omit the "$" sign in your response.)
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