Question

A manufacturer of 24-hr variable timers has a monthly fixed cost of $63,000 and a production cost of $6 for each timer manufactured. The units sell for $15 each. (a) Sketch the graphs of the cost function and the revenue function, and thereby find the break-even point graphically. (Use lines.) III CROSO. Assign graphing to Submission Data

Answer 1

let number of units = x Cost =y Cost function = c(x) = fixed & variable 63000 + 6x Revenue No. of units function - Price x R(x) = 15x a) Graph c(a) = 63000 +62 R (x) = 150 a R(x) x IC(a) 63000 63600 100 1500 Break Even when R(x) =((x) 15% = 92 = 63000+ 6x 53000 a= 7000 .: R(x)= 15 87000 = 105000 (1000, 105ooo)

250000 200000 150000- (7000, 105000) —100000 (0, 63000) -50000- 5000 (0, 0) -50000 |--100000