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Mega Power Co., manufactured and sold 1000 solar system last year at a price $700 each. The cost structure of solar system is as follows:
- Mega Power Co., manufactured and sold 1000 solar system last year at a price $700 each. The cost structure of solar system is as follows: Variable cost per system $300, factory overhead (total fixed costs $250,000). Due to heavy competition, price has to be reduce to $630 for the coming year.
Required: Assuming no change in costs, state the number of solar system that would have to be sold at the new price to ensure the same amount of profits that of the last year.
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