John is considering adding balloons to the product line he sells at the shop. There will be a cost of $200.00 for leasing the necessary equipment. The cost of buying balloons and helium and paying a worker is expected to be $4.25 per unit (balloon). He expects to sell the balloons for $6.75 each. a) Write the total cost function. b) Write the variable cost function. c) Write the revenue function. d) If John sells 70 balloons, calculate: average fixed cost, variable cost, revenue, average total cost. e) Will there be a profit or loss at this level of sales? How much? f) Determine the breakeven number of balloons.

Question

John is considering adding balloons to the product line he sells at the shop. There will be a cost of $200.00 for leasing the necessary equipment. The cost of buying balloons and helium and paying a worker is expected to be $4.25 per unit (balloon). He expects to sell the balloons for $6.75 each. a) Write the total cost function. b) Write the variable cost function. c) Write the revenue function. d) If John sells 70 balloons, calculate: average fixed cost, variable cost, revenue, average total cost. e) Will there be a profit or loss at this level of sales?  How much? f) Determine the breakeven number of balloons.