- Type the chosen name of the group for the refreshing drink in cell C4, and then press "Enter.” Be sure everyone in your group types the drink’s name exactly the same in their own workbooks to allow for the same fixed costs to generate in cells F5 and F6.
- You may resize column C to fit your name if you would like by hovering your cursor over the line between columns C and D.
- Use an Excel formula and cell references to calculate the annual fixed costs in cell F8. To do this, add the value in F5 to the value in F6 and multiply them to 12. The formula is =(F5+F6)*12
- Press Enter to calculate the formula.
- Once you have a value for the Annual Fixed Cost, a mark will appear in cell G8 that shows whether your answer is correct. Check your answer using the Feedback Key.
- Find the price and percent of demand. To do that, use the Price/Demand Graph. Find the price that will get you the maximum profit, with the corresponding demand. Just like in the image, you can choose 80 cents, with the corresponding demand of 60%. You may also decide to find a better combination or price and percent of demand. Work with your team on this.
- Enter these values in Part 3: Price and % of Demand table. Click Enter.
- Calculate the break-even point to find how many units (cups of your refreshing beverage) you’ll need to sell to cover your fixed costs. Use this formula: =F8/(K5-F9)
