If company A manufactures t-shirts and sells them to retailers for US$9.80 each. It has fixed costs of $2625 related to the production of the t-shirts, and the production cost per unit is US$2.30. Company B also manufactures t-shirts and selll them directly to consumers. The demand for its product is p = 15 − x/125 , its production cost per unit is US$5.00 i (i) Derive the total revenue function,R(x) for company B. (ii) Derive the profit function,Π(x) for company B. (ii) How many t-shirts must company B sell to in order to break-even.

Survey Of Economics
10th Edition
ISBN:9781337111522
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter6: Proudction Costs
Section: Chapter Questions
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If company A manufactures t-shirts and sells them to retailers for US$9.80 each.
It has fixed costs of $2625 related to the production of the t-shirts, and the production cost per
unit is US$2.30. Company B also manufactures t-shirts and selll them directly to consumers.

The demand for its product is p = 15 − x/125 , its production cost per unit is US$5.00

i (i) Derive the total revenue function,R(x) for company B.
(ii) Derive the profit function,Π(x) for company B.
(ii) How many t-shirts must company B sell to in order to break-even.
(iv) How many t-shirts must company B sell to maximise its profit.

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