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Break even analysis

To establish a driver education school, organizers must decide how many cars, instructors, and students to have. Costs are estimated as follows. Annual fixed costs to operate the school are $30,000. The annual cost per car is $3200. The cost per instructor is $11,000 and one instructor is needed for each car. Tuition for each student is $325. Let x be the number of cars and y be the number of students.
a. Write an expression for total cost.
b. Write an expression for total revenue.
c. Write an expression for total profit.
d. The school offers the course eight times each year. Each time the course is offered, there are two sessions. If they decide to operate five cars, and if four students can be assigned to each car, will they break even?

Solution Preview

Annual Fixed Costs = $30,000
Cost Per Car = $3,200
Cost Per Instructor = $11,000
Tuition for each student = $325

Number of cars = Number ...

Solution Summary

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