Answer:
The correct answer is option b.
Explanation:
The number of units of output sold is 8,000 .
The sales revenue is $9,600,000 .
The variable costs are $6,000,000 .
The fixed costs are $2,600,000.
The price of the product
= [tex]\frac{Sales\ Revenue}{Q}[/tex]
= [tex]\frac{9,600,000}{8,000}[/tex]
= $1,200
The average variable cost is
= [tex]\frac{TVC}{Q}[/tex]
= [tex]\frac{6,000,000}{8,000}[/tex]
= $750
Profit = TR - TC
Profit = [tex]Price\ \times\ Q - (AVC\ \times\ Q )\ +\ TFC)[/tex]
$1,270,000 = $1,200Q - $750Q - $2,600,000
$3,870,000 = $450Q
Q = [tex]\frac{3,870,000}{450}[/tex]
Q = 8,600 units
