A company has established that the relationship between the sales price for one of its products and the quantity sold per month is approximately p=70-0.2D (D is the demand or quantity sold per month and p is the price in dollars). The fixed cost is $700 per month and the variable cost is $40 per unit produced. a. What is the maximum profit per month for this product? b. What is the range of profitable demand during a month? a. The maximum profit per month for this product is $ (Round to the nearest dollar.)

A company has established that the relationship between the sales price for one of its products and the quantity sold per month is approximately p=70-0.2D (D is the demand or quantity sold per month and p is the price in dollars). The fixed cost is $700 per month and the variable cost is $40 per unit produced. a. What is the maximum profit per month for this product? b. What is the range of profitable demand during a month? a. The maximum profit per month for this product is $ (Round to the nearest dollar.)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Concept explainers

Cost of Production

The entire idea of the cost of production or production cost is applied corresponding, or we can say that it is related to monetary cost. Money cost refers to any money expenditure which the firm or supplier, or producer undertakes in purchasing or hiring factor of production or factor services.

Question

A company has established that the relationship between the sales price for one of its products and the
quantity sold per month is approximately p=70 -0.2D (D is the demand or quantity sold per month and p is
the price in dollars). The fixed cost is $700 per month and the variable cost is $40 per unit produced.
a. What is the maximum profit per month for this product?
b. What is the range of profitable demand during a month?
a. The maximum profit per month for this product is $
(Round to the nearest dollar.)

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Step 3: Calculate Profit Range:

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