Question

Consider the table below. It shows the total production costs for manufacturer Liljeroos when he manufactures boots (B) and mobile phones (M), for different numbers of the two products during one year. If the price of boots is SEK 40 per pair and the price of a mobile phone is SEK 100 each (both during the same year), after how many manufactured pairs of boots and manufactured mobile phones should manufacturer Liljeroos stop manufacturing more for the year? Manufacturer Liljeroos, through choice of production quantity, can not affect the price of neither boots nor mobile phones. Pair of Total Number of Total boots Costs (B) Mobile Phones Costs (M) 589 23 500 1 000 50 000 590 23 535 1 001 50 085 591 23 572 50 180 592 23 610 1 003 50 285 593 23 652 1 004 50 395 594 23 695 1 005 102 000 1 002

Answer 1

hair of boots Price of boots Total Revenue from Boots 40 589 590 59) T592 Total Cost Profit % Boots (TR-T2 23500 60 83535 65 83572 68 23610 70 23652 68 23895 65 23560 23600 23640 23680 23720 23760 40 40 40 593 594 Producing earn that only 592 pairs of boots highest profit because profits wese reduced to after Number of mobile phones Price of mobile Total Revenue of mobile Bifit Total Cost of mobile 100 100 1000 100 11002 1003 looy 100000 100100 100 200 100300 100400 100 100 soooo 50,ooo 50 085 soos sol80 80020 50285 50015 508985000 102000-1500 1005 1002 Mobile phones to eam higher profit of 50,000 after that profit were fallen