A company that manufactures small canoes has a fixed cost of 20,000. It costs $100 to produce each canoe. The selling price is $200 per canoe.

Question

In solving this exercise let x represent the number of canoes produced and sold.

Answer 1

20,000/100=200boats at $200ea=$40,000 which is a profit of 100%; as long as you have business/customers constantly.