00:01
I'm going to let x equal the number of units produced and sold.
00:05
So the cost function is going to be a function of x.
00:09
It is equal to the fixed cost, which is $40 ,000, plus the variable cost, which is $8 per unit.
00:22
So we need to multiply $8 by the number of units, which is x.
00:27
Okay, so this is our cost function.
00:30
The revenue will also be a function of x.
00:34
It is equal to the selling price per unit, which is $12, multiplied by the number of units, which is x.
00:44
So our revenue function is 12x.
00:48
The profit is equal to the revenue minus the cost.
00:54
So we have 12x minus $40 ,000 plus 8x.
01:03
So 12x minus 8x is 4x, and then we have minus $40 ,000...