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Process X has a fixed cost of Rs 40,000 per month and a variable cost of Rs 9 per unit. Process Y has a fixed cost of Rs 16,000 per month and a variable cost of Rs 24 per unit. At which value, total costs of processes X and Y will be equal?
- a)800
- b)1200
- c)1600
- d)2000
Correct answer is option 'C'. Can you explain this answer?
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Process X has a fixed cost of Rs 40,000 per month and a variable cost ...
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To find the value at which the total costs of processes X and Y will be equal, we need to set up an equation and solve for the value.
The total cost of process X can be represented as follows:
Total Cost of X = Fixed Cost of X + (Variable Cost per Unit of X * Quantity)
Similarly, the total cost of process Y can be represented as:
Total Cost of Y = Fixed Cost of Y + (Variable Cost per Unit of Y * Quantity)
Given that the fixed cost of process X is Rs 40,000 per month and the variable cost per unit is Rs 9, we can write the equation for the total cost of X as:
Total Cost of X = 40,000 + 9 * Quantity
Similarly, for process Y, the equation for the total cost becomes:
Total Cost of Y = 16,000 + 24 * Quantity
To find the value at which the total costs of X and Y are equal, we can set up the following equation:
40,000 + 9 * Quantity = 16,000 + 24 * Quantity
Next, we can solve this equation to find the value of Quantity. We can start by simplifying the equation by combining like terms:
40,000 - 16,000 = 24 * Quantity - 9 * Quantity
24,000 = 15 * Quantity
To isolate Quantity, we can divide both sides of the equation by 15:
Quantity = 24,000 / 15
Using long division or a calculator, we find that Quantity is equal to 1600.
Therefore, at a quantity of 1600 units, the total costs of processes X and Y will be equal. This is the point at which the fixed costs and variable costs of both processes balance out.
The total cost of process X can be represented as follows:
Total Cost of X = Fixed Cost of X + (Variable Cost per Unit of X * Quantity)
Similarly, the total cost of process Y can be represented as:
Total Cost of Y = Fixed Cost of Y + (Variable Cost per Unit of Y * Quantity)
Given that the fixed cost of process X is Rs 40,000 per month and the variable cost per unit is Rs 9, we can write the equation for the total cost of X as:
Total Cost of X = 40,000 + 9 * Quantity
Similarly, for process Y, the equation for the total cost becomes:
Total Cost of Y = 16,000 + 24 * Quantity
To find the value at which the total costs of X and Y are equal, we can set up the following equation:
40,000 + 9 * Quantity = 16,000 + 24 * Quantity
Next, we can solve this equation to find the value of Quantity. We can start by simplifying the equation by combining like terms:
40,000 - 16,000 = 24 * Quantity - 9 * Quantity
24,000 = 15 * Quantity
To isolate Quantity, we can divide both sides of the equation by 15:
Quantity = 24,000 / 15
Using long division or a calculator, we find that Quantity is equal to 1600.
Therefore, at a quantity of 1600 units, the total costs of processes X and Y will be equal. This is the point at which the fixed costs and variable costs of both processes balance out.
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Process X has a fixed cost of Rs 40,000 per month and a variable cost of Rs 9 per unit. Process Y has a fixed cost of Rs 16,000 per month and a variable cost of Rs 24 per unit. At which value, total costs of processes X and Y will be equal?a)800b)1200c)1600d)2000Correct answer is option 'C'. Can you explain this answer?
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Process X has a fixed cost of Rs 40,000 per month and a variable cost of Rs 9 per unit. Process Y has a fixed cost of Rs 16,000 per month and a variable cost of Rs 24 per unit. At which value, total costs of processes X and Y will be equal?a)800b)1200c)1600d)2000Correct answer is option 'C'. Can you explain this answer? for Mechanical Engineering 2024 is part of Mechanical Engineering preparation. The Question and answers have been prepared according to the Mechanical Engineering exam syllabus. Information about Process X has a fixed cost of Rs 40,000 per month and a variable cost of Rs 9 per unit. Process Y has a fixed cost of Rs 16,000 per month and a variable cost of Rs 24 per unit. At which value, total costs of processes X and Y will be equal?a)800b)1200c)1600d)2000Correct answer is option 'C'. Can you explain this answer? covers all topics & solutions for Mechanical Engineering 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Process X has a fixed cost of Rs 40,000 per month and a variable cost of Rs 9 per unit. Process Y has a fixed cost of Rs 16,000 per month and a variable cost of Rs 24 per unit. At which value, total costs of processes X and Y will be equal?a)800b)1200c)1600d)2000Correct answer is option 'C'. Can you explain this answer?.
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