Fixed cost = 10,000                        Material cost per unit = 0.15 Labor cost per unit = 0.10             Revenue per unit = 0.65 Suppose Toys R Us sells all that it produces, profit is calculated by subtracting the fixed cost and total variable cost from total revenue. Give a mathematical model for calculating profit and implement your model from part in Excel. If Toys R Us makes 12,000 units of the new product, what is the resulting profit?

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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Fixed cost = 10,000                       

Material cost per unit = 0.15

Labor cost per unit = 0.10            

Revenue per unit = 0.65

Suppose Toys R Us sells all that it produces, profit is calculated by subtracting the fixed cost and total variable cost from total revenue.

Give a mathematical model for calculating profit and implement your model from part in Excel.

If Toys R Us makes 12,000 units of the new product, what is the resulting profit?

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