Question 807879: A company produces a product for which the variable cost per unit is $6 and fixed cost is $80,000. Each unit has a selling price of $10. Determine the number of units that must be sold for the company to earn a profit of $60,000.
Answer by stanbon(75887)   (Show Source):
You can put this solution on YOUR website! A company produces a product for which the variable cost per unit is $6 and fixed cost is $80,000. Each unit has a selling price of $10. Determine the number of units that must be sold for the company to earn a profit of $60,000.
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Cost = C(x) = 80,000 + 6x where x is the number of units sold.
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Revenue = R(x) = 10x
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Profit = P(x) = Revenue - Cost = 10x -(80,000+6x) = 4x - 80,000
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Solve 4x-80000 = 60,000
4x = 140000
x = 35,000
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Cheers,
Stan H.
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