Question

Jessica wants to start making and selling bracelets using colorful beads and thread. She starts collecting information to come up with a business model. She finds out that she will have to pay $250 in rent per month. Her phone and Internet costs will be $40 per month. The material cost per bracelet will be $1.25, and a helper will charge $0.25 per bracelet. Jessica plans to make 200 bracelets in the first month. Jessica’s fixed monthly cost is $, and her variable cost is $ per bracelet. To break even she will have to sell the bracelets for $

Answer 1

If I understand correctly, her variable cost ist 1.25+0.25=1.5 per bracelet. Since she will make 200 bracelets, this will be  200*1.5=300 dolars


Her fixed monthly cost is 250+40=290

so to break even, she needs to make 300+290 dollars, which is 590 dollars.

that means that each bracelet will cost 590/200 dollars, which is

$\frac{590}{200} = \frac{59}{20} =2 \frac{19}{20} =2 \frac{19*5}{100} =2.95$

so to break even she needs to sell the bracelets for 2.95.

if she sells it for more, she will make some profit actually.