a bicycle store costs $3600 per month to operate. The store pays an average of $60 per bike. the average selling price of each bicycle is $100. how many bicycles must the store sell each month to break even?
Cost function C(b) where b is the number of bikes:
C(b) = Variable Cost + Fixed Cost
C(b) = Cost per bike * b + operating cost
C(b) = 60b + 3600
Revenue function R(b) where b is the number of bikes:
R(b) = Sale price * b
R(b) = 100b
Break Even is when Cost equals Revenue, so we set C(b) = R(b):
60b + 3600 = 100b
To solve this equation for b, we type it in our math engine and we get:
b = 90
Cost function C(b) where b is the number of bikes:
C(b) = Variable Cost + Fixed Cost
C(b) = Cost per bike * b + operating cost
C(b) = 60b + 3600
Revenue function R(b) where b is the number of bikes:
R(b) = Sale price * b
R(b) = 100b
Break Even is when Cost equals Revenue, so we set C(b) = R(b):
60b + 3600 = 100b
To solve this equation for b, we type it in our math engine and we get:
b = 90