SOLUTION: A manufacturer sells a product for $10 per unit. The manufacturer�s fixed costs are $1200 per month, and the variable costs are $2.50 per unit. a) How many units must the manufact

Question 1099526: A manufacturer sells a product for $10 per unit. The manufacturer�s fixed costs are $1200 per month, and the variable costs are $2.50 per unit.
a) How many units must the manufacturer produce each month to break even?
b) Find the profit function for the manufacturer.
c) Graphtheprofitfunctionshowingclearlytheprofitandlossregions.
Answer by ankor@dixie-net.com(22740) (Show Source): You can put this solution on YOUR website!
A manufacturer sells a product for $10 per unit.
The manufacturer�s fixed costs are $1200 per month, and the variable costs are $2.50 per unit.
a) How many units must the manufacturer produce each month to break even?
Break even occurs when revenue = total cost
let x = no. of units
10x = 2.5x + 1200
10x - 2.5x = 1200
7.5x = 1200
x = 1200/7.5
x = 160 units have to be sold in 1 month to break even
:
b) Find the profit function for the manufacturer.
p(x) = 10x - (2.5x+1200)
:
c) Graphtheprofitfunctionshowingclearlytheprofitandlossregions

Red is cost, green is revenue, intersect is break even point
Profit area is above the red and to the right of green
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