Problema Solution

Revenue and Cost (Refer to Example 12.) The

cost to produce one compact disc is $1.50 plus a

one-time fixed cost of $2000. The revenue received

from selling one compact disc is $12.

(a) Write a formula that gives the cost C of producing

x compact discs. Be sure to include the fixed

cost.

(b) Write a formula that gives the revenue R from

selling x compact discs.

(c) Profit equals revenue minus cost. Write a formula

that calculates the profit P from selling x

compact discs.

(d) What numbers of compact discs need to be sold

to yield a positive profit?

Answer provided by our tutors

a) C=2000+1.5*n, where n is the number of disks

b)R=12*n

c)P=R-C=12n-(2000+1.5n)=10.5n-2000

d)P>0 means

10.5n-2000>0

10.5n>2000

n>2000/1.5≈1333.33

So he needs to sell at least 1334 CD-s to get profit