A small ice cream company estimates its revenue to be R=6x dollars, where x is the number of quarts of ice cream sold. The ice cream company estimates its fixed monthly costs to be $275 and the cost to produce each quart of ice cream to be $5.5, where x is the number of quarts of ice cream sold.
What is the selling price of each quart of ice cream?
$ .
In order to break even, the company must sell at least quarts of ice cream each month.
What is the margin of profit if 450 quarts of ice cream are sold each month?
$ (If a loss, indicate with a negative sign)
What is the margin of profit if 800 quarts of ice cream are sold each month?
$ dollars. (If a loss, indicate with a negative sign)
Manufacturing companies usually have two types of costs. Fixed costs, sometimes called overhead, are costs that are not related to the number of items manufactured. Fixed costs include things like rent, a base level of utilities, and a base level of salaries and must be paid even if the company does not make any products. Variable costs depend on the number of items manufactured. As a manufacturing company increases the number of items it produces, the fixed costs do not change, but the variable costs increase.
One company manufactures high-end racing bicycles. The monthly fixed costs are $3720. The total cost to manufacture 26 bikes is $20230. Assume that total cost, C, is linearly related to the number of bicycles, x, that the company manufactures.
A) The cost function is: Remember to use function notation.
B) The cost to produce each additional bike is $
C) The total cost to manufacture 50 bikes is $
For a particular item, if the price is $12 per item, then the demand is 687 items. However, if the price is raised to $27 per item, then the demand decreases to 567 items.
Using this information, find the demand equation as a function of the price p.
In particular, if the price is $34 per item, then the demand is 220 items. However, if the price is lowered to $4 per item, then the demand increases to 320 items.
Using this information, find the price equation as a function of the demand x.