Mathematics · Commercial Mathematics
A manufacturing company has total fixed costs of ₹1,20,00,000 per annum. The variable cost per electronic sensor is ₹450 and the planned selling price is ₹750. A 10% discount on the selling price is proposed. If the company maintains the original price, how many units must it sell to break even, and what happens to the break-even point if the 10% discount is implemented?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1The original break-even point is 40,000 units and the discount will decrease it to 35,000 units.
- 2The original break-even point is 26,667 units and the discount will have no effect because fixed costs are constant.
- 3The original break-even point is 16,000 units and the discount will decrease it to 14,000 units.
- 4The original break-even point is 40,000 units and implementing the discount will increase it to 53,334 units.✓
Correct answer
The original break-even point is 40,000 units and implementing the discount will increase it to 53,334 units.
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