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24 Sep 2018, 05:44
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D
Be sure to select an answer first to save it in the Error Log before revealing the correct answer (OA)!
Difficulty:
5%
(low)
Question Stats:
91% (01:09) correct
9%
(01:17)
wrong
based on 55
sessions
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A small textile company buys few machines to stitch garments, costing a total of $10,000. The per unit cost of each garment is $2.50 and is sold for $4.50. How many units of the garments must be sold to achieve break-even (A phenomenon when all the investment and production costs are recovered by the sales revenue)?
(A) 2000
(B) 3500
(C) 4500
(D) 5000
(E) 6000
(A) 2000
(B) 3500
(C) 4500
(D) 5000
(E) 6000
Updated on: 24 Sep 2018, 21:39
Originally posted by GMATinsight on 24 Sep 2018, 20:06.
Last edited by GMATinsight on 24 Sep 2018, 21:39, edited 1 time in total.
Last edited by GMATinsight on 24 Sep 2018, 21:39, edited 1 time in total.
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Bunuel
Let, Number of sold units = x
For Break-Even, COST = REVENUE
i.e. 10,000+2.5*x = 4.5*x
i.e. 2x = 10000
i.e. x = 5000
Answer: Option D
24 Sep 2018, 20:58
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GMATinsight
The question implies that (the total cost to produce n units) = (cost of machines) + (per unit cost) = $10,000 + $2.5*x.
