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{"ops":[{"insert":"7. Elgar Toaster Co. is contemplating a modernization of its antiquated plant. It now sells its "},{"insert":"\n"},{"insert":""},{"insert":"\n"},{"insert":"toasters for $20 each; the variable cost per unit is $8, and fixed costs are $840,000 per year."},{"insert":"\n"},{"insert":""},{"insert":"\n"},{"insert":"a. Calculate the break-even quantity."},{"insert":"\n"},{"insert":""},{"insert":"\n"},{"insert":"b. If the proposed modernization is carried out, the new plant would have fixed costs of "},{"insert":"\n"},{"insert":""},{"insert":"\n"},{"insert":"$1,200,000 per year, but its variable costs would decrease to $5 per unit."},{"insert":"\n"},{"insert":""},{"insert":"\n"},{"insert":" 1. What will be the break-even point now?"},{"insert":"\n"},{"insert":""},{"insert":"\n"},{"insert":" 2. If the company wanted to break even at the same quantity as with the old plant, "},{"insert":"\n"},{"insert":""},{"insert":"\n"},{"insert":"what price would it have to charge for a toaster?"},{"insert":"\n"}]}

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