Charlie is planning to start a business selling kitten mittens. He figured that the fixed...
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Charlie is planning to start a business selling kitten mittens. He figured that the fixed costs would be Cats Knitting Machine Warehouse Truck 100 $5,000 $10,000 $2,000 He also knows that variable cost (per unit) is Yarn Labor $2 $1 He wants to sell a pair (unit) of kitten mittens for $15 Questions 1) Frank, the potential investor, would like to know how many pairs of kitten mittens they have to sell to break even. What is the break-even point? (2 pts) Dennis, the other potential investor, would like to know how many they have to sell to make a profit of $20,000 so he can buy a boat. What's the minimum sales target they have to hit for it to happen? (2 pts) Charlie is pretty sure that the demand function is as following: 2) 3) 80,000- 2P According to the demand function, is there enough demand for them to break even if they sell the kitten mittens for $15 a pair (unit)? In other words, how many consumers are willing to pay $15 or more for a pair of kitten mittens? (1 pts)
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