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A publisher for a promising new novel figures fixed costs (overhead, advances, promotion, copy editing,...

A publisher for a promising new novel figures fixed costs (overhead, advances, promotion, copy editing, typesetting, and so on) at $50,000, and variable costs (printing, paper, binding, shipping) at $2.10 for each book produced. If the book is sold to distributors for $12 each, how many must be produced and sold for the publisher to break even?
The publisher must produce and sell ____ books to break even (Round to the nearest integer as needed.)

Answer

To find the break-even point, use the formula:

Break-even point (in units) = Fixed Costs / (Selling Price per Unit - Variable Cost per Unit)

Fixed Costs = $50,000

Selling Price per Unit = $12

Variable Cost per Unit = $2.10

Break-even point = $50,000 / ($12 - $2.10) = $50,000 / $9.90 ≈ 5051

The publisher must produce and sell 5051 books to break even.

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