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Pricing Break Even Case Read the following case and answer the questions below. You will...

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Pricing Break Even Case Read the following case and answer the questions below. You will need a calculator fo help you. Alyssa Salisbury plans to sell a new line of blue jeans which she calls Dream Jeans. A clothing merchant in Newmarket has agreed to produce the jeans for Alyssa at a price of $17.00 per pair of jeans. Alyssa recognizes that sales will vary, but she believes that she can sell an average 2,000 pairs of jeans a month. She estimates that her average monthly operating expenses (fixed costs) will total $6,000 (including advertising, insurance, and equipment depreciation). Alyssa plans to run the business from her basement, so there will be no wage expenses, or handling charges. 1. What is Alyssa's cost per pair of jeans (variable cost)? 2. At 2,000 pairs a month, what are her operating expenses (fixed costs) per pair of jeans? (fixed cost for ONE pair of jeans) 3. What will the total cost be per pair of jeans? 4. What is Alyssa's breakeven point, in units, if her selling price is $37 per pair? 5. If Alyssa actually sells 2,000 pairs per month, what is her net profit? 6. What is the markup on her jeans? 7. What could Alyssa specifically do to break even with less units

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