Form this profit function and find the break even point....

[alexisonfire181]

A certain company has fixed costs of $15,000 for its product and variable costs given by (140+.04x) dollars per unit, when x is the total number of units. The selling price of the product is (300-.6x) dollars per unit. Form this profit function and find the break even point, and level of sales which maximized profit.

 

[jwpaine]

Please show the work that you have done in attempt to solve this problem. What are you stuck on? We won't do the work for you.

Thanks,
John.

 

[alexisonfire181]

so far

So far I have:

15,000=140+.04x

x-371,500

I dont know where to go from here

 

[Mrspi]

Re: help 2

A certain company has fixed costs of $15,000 for its product and variable costs given by (140+.04x) dollars per unit, when x is the total number of units. The selling price of the product is (300-.6x) dollars per unit. Form this profit function and find the break even point, and level of sales which maximized profit.

You have two things going on here.....cost (what the product costs to make), and revenue (the amount you take in when you sell your product).

Profit = revenue - cost

If you produce "x" items, the cost as described in the problem is $15,000 + x(140 + 0.04x). So, the cost function is

C(x) = 15000 + x(140 + 0.04x)

If you SELL x items at a cost of (300 - .6x) per item, your revenue will be x(300 - .6x)

The revenue function is
R(x) = x(300 - .6x)

Profit = Revenue - Cost

P(x) = x(300 - .6x) - [15000 + x(140 + 0.04x)]

The "breakeven point" is where Cost = Revenue.....