Question

Samir, a carpenter, spent $300 on specialty tools to make toy horses for children. For each horse he makes, he spends $75 on supplies. He charges $125 for each horse. How many horses must Samir sell in order to break even?

Answer 1

Answer:

Samir must sell 6 horses in order to break even.

Answer 2

The number of horses that Samir must sell in order to break even is 6 horses.

Calculations and Parameters:

Given:

• Fixed cost = $300
• Variable cost = $75 on each supply
• Revenue = $125 on each horse.

To find breakeven, we must remember that the revenue and cost are equal.

Therefore, we create a function and use this to solve:

125x= 300  + 75x

125x-75x = 300

50x = 300

x= 6

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