Toby's Tiny Toys have fixed expenses of $53,900 for the production of their tiny toys. Toby's has a variable expense of $12.50 a

The overall expenses of the factory comprise both its variable and fixed costs. The factory incurs fixed costs of $53,900 alongside variable costs of $12.50 for each unit manufactured. If we denote as the total number of toys produced by Toby's Tiny Toys, then the total variable costs would be . From here, we can conclude that the cost function for the factory is,

Conversely, if we define as the amount of toys sold, we can determine that at a selling price of $16.50, the revenue function will be,

Toby's Tiny Toys will achieve their break-even point when their total costs match the total revenue. At this point, we determine that

The company must sell 134,750 units to break even.