Rainbow Tours gives walking tours of Springfield. Rainbow charges $40 per person for the tour and incurs $16 in variable costs for labor, drinks, and maps. The monthly fixed costs for Rainbow Tours are $3,600.

Required:

(a)	How many tours must Rainbow sell every month to break even?

Break even

tours

(b)	Rainbow Tourss owner believes that 175 people a month will sign up for the walking tour. What is the margin of safety in terms of the number of people signing up for the tour?

Margin of safety

people