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sb lliw od tadi shinob ..$7.20 Janelle Heinke, the owner of Ha'Peppas!, is consider- ing a new oven in which to bake the firm's
sb lliw od tadi shinob ..$7.20 Janelle Heinke, the owner of Ha'Peppas!, is consider- ing a new oven in which to bake the firm's signature dish, vegetar- ian pizza. Oven type A can handle 20 pizzas an hour. The fixed costs associated with oven A are $20,000 and the variable costs are $2.00 per pizza. Oven B is larger and can handle 40 pizzas an hour. The fixed costs associated with oven B are $30,000 and the variable costs are $1.25 per pizza. The pizzas sell for $14 each. a) What is the break-even point for each oven? b) If the owner expects to sell 9,000 pizzas, which oven should she purchase?
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