) Determine an annual total cost function for the manufacturing the three models. 2) Determine the profit function for sales of the three models. 3) What is the annual profit if the firm sells 20,000, 40,000, and 10,000 units, respectively, of the three models
Question No.2
A manufacturer of microcomputers produces three different models. The following table summarizes wholesale prices, materials cost per unit, and labor cost per unit. Annual fixed costs are $20 million.
Model-1 Model-2 Model-3
Wholesale price / Unit (in dollars) $700, $8000, $1000
Material cost / Unit(in dollars) 185, 500 ,850
Labor cost / unit(in dollars) 150, 200 , 325
1) Determine an annual total cost function for the manufacturing the three models.
2) Determine the profit function for sales of the three models.
3) What is the annual profit if the firm sells 20,000, 40,000, and 10,000 units, respectively, of the three models
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