Essentials of Economics
4th Edition
ISBN: 9781464186653
Author: Paul Krugman, Robin Wells
Publisher: Worth Publishers
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Chapter P3, Problem 1.3BC
To determine
Impact on cost when robots are hired for temporary period.
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Why is a normal profit considered an economic cost?
Bill runs a business that makes custom-printed towels. It will cost him $8 each to purchase and print on towels, and he will have to pay a rent of $1,700 per month for him workshop. Based on market research, Bill estimates that he can sell custom towels for $25 each.
a) Calculate the number of towels he needs to sell per month to break-even.
towels
b) Calculate the break-even in dollars (round off to the nearest cent).
It’s question 3.13 Body Shop
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