SOLUTION: a financial advisor has conducted some research and has advised a company that the cost of producing their new transistor radio c, can be modeled by the equation c=18.96x+5275, whe
Question 158542: a financial advisor has conducted some research and has advised a company that the cost of producing their new transistor radio c, can be modeled by the equation c=18.96x+5275, where x is the number of radios produced. The advisor has also conducted research to determine that the best selling price of the radio is $29.99. As a result, the best model for the company's revenue R is the equation R=29.99x, where x is the number of radios sold.
The company executives have decided that they are willing to invest $10,000 in the new product. If this money is to be used for the costs of the radios, how many radios should the company be able to produce?
If the company produces the maximum number of radios with their $10,000 investment and all the radios are sold, how much revenue will the company generate from the new product? Answer by gonzo(654) (Show Source):
You can put this solution on YOUR website! based on the numbers you provided, this is the solution.
cost of building radios is $5275.00 + ($18.96)*x where x is the number of radios produced.
Investment is $10,000 to produce maximum number of radios.
maximum number of radios that can be produced for $10,000 is determined by the formula below:
solving for x, we get
this becomes
this becomes rounded to the nearest unit = 249 radios that can be produced.
to check the numbers, we take 5275 + 249*18.96 = 5275 + 4721.04 = total cost of $9996.04 which leaves $3.96 left over.
revenue from these 249 radio will be $29.99 * 249 = $7,467.51.
based on the numbers given, revenue generated will be less than the cost to produce the radios.
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