Question

Vino Bella Cellars sells the units for $4,500 each. The price does not vary with the number of units sold. How many units should Vino Bella Cellars manufacture and sell each month?

Answer 1

Any quantitiy more than the breakeven quantity is the target.

Breakeven quantitiy is the quantity where total revenue=total cost or profit=0

SOmething like below table has to be made

As you have not provided the data, I have assumed some data and provided the table:

Quantity Average Cost Total Cost Marginal Cost Total Revenue Profit

1 6000 6000 0 4500 -1500

2 5000 10000 4000 9000 -1000

3 4300 12900 2900 13500 600

4 3850 15400 2500 18000 2600

5 3550 17750 2350 22500 4750

6 3550 21300 3550 27000 5700

In this case, anything more than 3 should be target