Question 381738: 5) Cable: A new 1,000 mile system of Comcast cable costs an average of $15,000/mile or $15 million to build. Basic cable with monthly service charges is$30 per month. How many homes are needed to break even? How many homes are needed to return a 10 % profit? Answer and explain.
Answer by stanbon(75887)   (Show Source):
You can put this solution on YOUR website! A new 1,000 mile system of Comcast cable costs an average of $15,000/mile or $15 million to build. Basic cable with monthly service charges is $30 per month.
How many homes are needed to break even?
15 million/30 = (1/2) million
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Comment: That is a meaningless number. Home fees do not a single mile of
cable service, they support many miles of cable service.
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How many homes are needed to return a 10 % profit?
Comment: Another meaningless number.
1.10*15 million = 16.5 million
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16.5 million/30 = 0.55 million homes
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Cheers,
Stan H.
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