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Target Exam

CUET

Subject

Entrepreneurship

Chapter

Business Arithmetic

Question:

If the unit selling price is Rs. 70,000, unit variable cost is 40,000 and the fixed expenses per month is 1,20,000, the break even quantity per month is ______.

Options:

5

4

10

5

Correct Answer:

4

Explanation:

To calculate the break-even quantity per month, we can use the following formula:

Break-even quantity = Fixed expenses / (Unit selling price - Unit variable cost)

Plugging in the given values, we get:

Break-even quantity = 1,20,000 / (70,000 - 40,000)

Break-even quantity = 1,20,000 / 30,000

Break-even quantity = 4

Therefore, the break-even quantity per month is 4 units.

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