Multiple Choice
Colin was a professional classical guitar player until his motorcycle accident that left him disabled. After long months of therapy, he hired an experienced luthier (maker of stringed instruments) and started a small shop to make and sell Spanish guitars. The guitars sell for $700 and the fixed monthly operating costs are as follows: 
Colin's accountant told him about contribution margin ratios and he understood clearly that for every dollar of sales, $0.60 went to cover his fixed costs, and that anything past that point was pure profit. How many guitars does Colin have to sell each month to break even?
A) 6 guitars
B) 14 guitars
C) 7 guitars
D) 9 guitars
Correct Answer:
Verified
Correct Answer:
Verified
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