Question:
- Case Study
‘Tasty Break’ the sandwich business, has fixed costs of £1000. The cost to produce a sandwich is £1 and the price charged for each sandwich is £2.
Questions
1. Give one example of a fixed cost for ‘Tasty Break’ and one variable cost?
2. What happens to the breakeven point if: – questions below.
a) The price of a sandwich is reduced to £1.50?
b) A cheaper bread supplier is found reducing the production costs to 70p?
c) Fixed costs increase to £1100 per month?
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