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( ii ) A company manufactures a product and finds that the fixed costs are 1 0 , 0 0 0 , the labour costs
ii
A company manufactures a product and finds that the fixed costs are the labour costs are per unit and other variable costs are per unit. The selling price is fixed at
Due to changes in the economic environment the company purchases a new machine for this would increase the fixed costs by this amount The new machine would mean that labour costs will be reduced by a third. Assume that other costs and the selling price remain unchanged.
Find the following level of sales.
i At the breakeven point.
ii To produce a profit of
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