Question
You are thinking of opening a small copy shop. It costs $8000 to rent a copier for a year, and it costs $0.023 per copy
You are thinking of opening a small copy shop. It costs $8000 to rent a copier for a year, and it costs $0.023 per copy to operate the copier. Other fixed costs of running the store will amount to $600 per month. You plan to charge an average of $0.12 per copy, and the store will be open 365 days per year. Each copier can make up to 150,000 copies per year
a. Using Excel, construct a two-way profit table (number of copiers on the left runnin top to bottom and daily demand on the top running from left to right) for one to five copiers rented and daily demands of 1000, 1500, 2000 and 2500 copies per day, find annual profit. That is, find annual profit for each of these combinations of copiers rented and daily demand.
b. If you rent three copiers, what daily demand for copies will allow you to break even? Draw a break even graph to show this break even relationship.
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