Question

A mail order company has sent a questionnaire to each of its customers, asking how many of the previous year's promotions prompted orders that would not have otherwise been made. The accompanying table lists the probabilities that were derived from the questionnaire, where X is the random variable representing the number of promotions that prompted orders.

X 0 1 2 3 4

P(X) 0.075 0.24 0.39 0.162 0.133

The fixed cost of conducting the four promotions is estimated to be 17000 dollars with a variable cost of 2 dollars per customer for mailing and handling costs. What is the minimum number of customers required by the company in order to cover the cost of promotions? (Round your answer up to the next highest integer.)

Break even point =

Answer 1

You can't break even unless there is a profit associated with each sale, all you listed were the costs.

net profit=income(sales)-cost(sales)-fixedcost

Answer 2

How do you do this?