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2. A company has fixed costs of e 5,000 and variable costs of e 20 per unit, and sells the product for e 40 a unit.

(i) Find the total cost function.

(ii) Determine the total revenue function.

(iii) Find the profit function, and determine the profit when 500 units are sold.

(iv) How many units must be produced and sold for the company to break even? (v) How many units have to be produced and sold to yield a profit of e 10,000?

 Aug 6, 2016
 #1
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Tc=5000+20n

Tr=40n

Pr=40n-(5000+20n)=20n-5000

P(500)=20×500-5000=5000

Break even

Pr=0.    So.    N=250unit

 

Pr =10000

N=7500 units

 Aug 6, 2016

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