Radar Company sells bikes for $300 each. The company currently sells 3,750 bikes per year and could make as many as 5,000 bikes per year. The bikes cost $225 each to make: $150 in variable costs per...


Radar Company sells bikes for $300 each. The company currently sells 3,750 bikes per year and could

make as many as 5,000 bikes per year. The bikes cost $225 each to make: $150 in variable costs per bike

and $75 of fixed costs per bike. Radar received an offer from a potential customer who wants to buy 750

bikes for $250 each. Incremental fixed costs to make this order are $50,000. No other costs will change if

this order is accepted. Compute Radar’s additional income (ignore taxes) if it accepts this order.



Jun 10, 2022
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