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Question
find the operating expenses, the operating loss, and the absolute loss.
| cost | operating expenses | break - even point | reduced price | operating loss | absolute loss |
|---|
| cost | operating expenses | break - even point | reduced price | operating loss | absolute loss |
|---|
Step1: Calculate Operating Expenses
The break - even point formula is \( \text{Break - even Point}=\text{Cost}+\text{Operating Expenses} \). We know that the cost is $45 and the break - even point is $56. Let the operating expenses be \( OE \). So, \( 56 = 45+OE \). Solving for \( OE \), we get \( OE=56 - 45=\$11 \).
Step2: Calculate Operating Loss
The operating loss is calculated as the difference between the break - even point and the reduced price. Let the operating loss be \( OL \). So, \( OL = 56-36=\$20 \).
Step3: Calculate Absolute Loss
The absolute loss is calculated as the difference between the cost and the reduced price. Let the absolute loss be \( AL \). So, \( AL=45 - 36=\$9 \).
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Operating Expenses: \(\$11\), Operating Loss: \(\$20\), Absolute Loss: \(\$9\)