Using the concept of break even point, it is found that 25334 items must be sold to reach the break even point.
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The expense equation is:
[tex]E(q) = 11q + 76000[/tex]
The revenue equation is:
[tex]R(q) = 14q[/tex]
The break even point is the value of q for which expense and revenue are equal, thus:
[tex]R(q) = E(q)[/tex]
[tex]14q = 11q + 76000[/tex]
[tex]3q = 76000[/tex]
[tex]q = \frac{76000}{3}[/tex]
[tex]q = 25333.33[/tex]
Rounding up, 25334 items must be sold to reach the break even point.
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