PDA

View Full Version : A problem that doesn't make sense- a linear cost function


cnycole
Jan 28, 2011, 12:32 PM
Please help me, I am getting only negative answers that I think are absolutely wrong. This problem has five parts:

Jill starts a business of manufacturing custom seat cushions for large trucks. She determines that the fixed cost is $1,375 and unit cost is $22. She sells each cushion for $49.95.

A) Find the linear cost function C(x), revenue function R(x) and profit function P(x) assuming x cushion were made and sold.
---for this I was able to make these functions. Please correct me if I'm wrong:

--->C(x)= 49.95x+1375; R(x)= 22x; P(x)=22x-49.95x+1375

B) Find the cost, revenue, and profit if 200 cushions were made and sold.

---> My answers: Cost is $11,365; Revenue is $4,400; and Profit is $-6,965

C) How many cushions must she make and sell in order to attain a profit of $5,000?

---> This is where I find a problem, because using the P(x)=R(x)-C(x)gives me a negative answer.

D) Find the break-even

E) Graph C(x) and R(x)

galactus
Jan 28, 2011, 12:57 PM
You have the incorrect Revenue function.

The Cost function is:

22x+1375

The Revenue function is:

49.95x

The Profit is:

49.95x-(22x+1375)=27.95x-1375

For a profit of 5000, then

5000=27.95x-1375

x=229 cushions

And so on

Break even is when R=C.

So, 49.95x=1375+22x

x=50

Unknown008
Jan 28, 2011, 12:58 PM
C(x) is wrong and should be

C(x) = 1375 + 22x

Then, R(x) becomes:

R(x) = 49.95x

And profit:

P(x) = 49.95x - (1375 + 22x)

Can you try again now? :)

EDIT: A minute difference galactus :p

cnycole
Jan 30, 2011, 02:41 PM
Thank you so much!

cnycole
Jan 30, 2011, 02:41 PM
Thank you!!