break-even analysis

break-even analysis

Chose a real-world, new venture idea you might actually consider pursing. Calculate a rough, break-even estimate for this idea. This means, you should calculate how many units or customers you will need over the course of either one month or one year in order for your business to be profitable. Your choice of whether to base this calculation over one month or one year will depend on the nature of your business idea. Either one is acceptable.

Forr detail on what a break-even analysis is review material on “break-even analyses” you may find on the web. 

Then answer the following questions:

  1. What time period are you considering (a week, month or year)?
  2. What are your fixed costs (in dollars) over that period?
  3. What is your average price (in dollars)?
  4. What is your variable cost per unit (in dollars)?
  5. What is your break-even quantity?

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