Break-Even Point

5.     Samocat Automotive want to move the production of their motor scooters to a purpose-built new plant that will cost £24 m to construct. The scooters sell for £1850 and variable costs of production amount to £1100 per scooter.

(a)  What is the break-even point for scooter production at the new plant?

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(b)  How will the break-even point change if the costs of the new plant rise to £30 m?

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