Question
You did such a terrific job in your principles of marketing class at MSU Denver that you decided to go into business for yourself as
You did such a terrific job in your principles of marketing class at MSU Denver that you decided to go into business for yourself as a marketing consultant. One of your clients, the Stupidiotic Company (a South Korean company) has asked you to perform some break-even analyses for it. It has provided the following information to help in your work.
Total Fixed Costs = 41,896,000 won
Variable Cost per Unit = 20,300 won
Price per Unit = 49,500 won
Again, use the information used for the previous three items. The company is planning to introduce a new product soon and would like you to help determine the minimum price it must charge to break even. The fixed costs for the new product are 22,555,000 won. The total variable costs are 13,200,000 won, and the forecasted sales for the first year are 19,000 units. What is the break-even price?
a. 13,201,187.11 won
b. 1,881.85 won
c. 92,167 won
d. 1,882 won
e. None of the above
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