Minor Video Has Opened a New Store Renting Videocassettes

Multiple Choice

Minor Video has opened a new store renting videocassettes. Fixed costs are $60,000, and the variable cost per unit is $1.50. The average sale is $5 per customer. Use the following axes to determine the break-even quantity graphically. Next, refine your solution by solving it algebraically.

A) The break-even quantity is fewer than or equal to 10,000 rentals.
B) The break-even quantity is more than 10,000 rentals and fewer than or equal to 20,000 rentals.
C) The break-even quantity is more than 20,000 rentals and fewer than or equal to 25,000 rentals.
D) The break-even quantity is more than 25,000 rentals.