Problem 12: With respect to the given data of Problem 11
***Data from problem 11***
Total fixed costs:
Copyediting $ 10,000
Typesetting 70,000
Selling and promotion 20,000
Total fixed costs 100,000
Average variable costs: $ 6
Administrative costs 2
Sales commissions 1
Bookstore discounts 7
Author's royalties __ 4___
Average variable costs $20
Project selling price $30
- Find the publisher's breakeven output and the output that would lead to a total profit of $60,000 if, as a result of a technological breakthrough in printing, the publisher was able to lower TFC to $40,000. Draw a chart showing your answer.
- Find the publisher's breakeven output and the output that would lead to a total profit of $60,000 if total fixed costs remained at $100,000 but average variable costs declined to $10. Draw a chart to show your answer