The parent-teacher organization is selling baskets of cookies for a school fundraiser. The materials needed to make each basket cost $3.75 and the baskets are being sold for $10 each. If they spend $75 to advertise their sale, how many baskets must be sold to break even?

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02-01-2020
Social Studies

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The parent-teacher organization is selling baskets of cookies for a school fundraiser. The materials needed to make each basket cost $3.75 and the baskets are being sold for $10 each. If they spend $75 to advertise their sale, how many baskets must be sold to break even?

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fatimakincsem fatimakincsem · Answer 1 · 2020-01-16T11:45:48+01:00

The correct answer would be 12 Baskets.

If they spend $75 to advertise their sale, 12 baskets must be sold to break even.

Explanation:

Break even is a point where there is no loss and no profit for the product produced and sold.

Now material needed to make each basket = $3.75

Selling Price of Baskets = $10

Profit on each basket = Selling Price - Cost to make basket = $10 - $3.75 = $6.25

So the advertising expense is $75. Then to find that how many baskets must be sold to break even, we would divide the advertisement cost with the profit on each basket as follows:

$75 / $6.25 = 12

So 12 baskets are needed to be sold in order to break even.

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