Asked by susan
A camera manufacturer spends $2050 each day for overhead expenses plus $7 per camera for labor and materials. The camera sells for $17 each.
a. How many cameras must the company sell in one day to equal its daily costs?
b. If the manufacturer can increase production by 50 cameras per day, what would their daily profit be?
a. How many cameras must the company sell in one day to equal its daily costs?
b. If the manufacturer can increase production by 50 cameras per day, what would their daily profit be?
Answers
Answered by
Steve
If cost = revenue for x cameras, then
2050+7x = 17x
x=205
Assuming you mean 50 more than the break-even number, then since profit = revenue - cost,
p = 17*255 - (2050+7*255)
Another way to look at it is that the profit per camera is 17-7=10 dollars.
So, with zero profit at 205 units, all the profit made on the extra 50 cameras is 50*10 = $500
2050+7x = 17x
x=205
Assuming you mean 50 more than the break-even number, then since profit = revenue - cost,
p = 17*255 - (2050+7*255)
Another way to look at it is that the profit per camera is 17-7=10 dollars.
So, with zero profit at 205 units, all the profit made on the extra 50 cameras is 50*10 = $500
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