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Tesla Inc. is analyzing the profitability of its Model 3 electric car. The company estimates that the variable cost per car is $30,000, and the
Tesla Inc. is analyzing the profitability of its Model 3 electric car. The company estimates that the variable cost per car is $30,000, and the fixed costs for the production facility amount to $2,000,000 per month. If Tesla plans to sell the Model 3 for $50,000 each, how many cars must they sell each month to break even? Additionally, if they want to achieve a monthly profit of $1,000,000, how many cars must they sell? Provide a detailed explanation of your calculations
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