Question

The operating costs of a swimsuit distributor are $120,000 per year plus $23 per swimsuit. The current partners have

Answer 1

The swimsuits that can be produced with the new partner is  23,043.

The swimsuits that can be produced without the partner is  16,521.

How many swimsuits can be produced?

The equation that relates total cost, operating cost and cost per swimsuit together is

Total cost = operating cost + (cost per swimsuit x number of swimsuits)

500,000 = 120,000 + ($23x s)

500,000 - 120,000 = 23s

380,000 = 23s

s = 380,000 / 23

s = 16,521

Number of swimsuits that can be produced with the new partner:

(500,000 + 150,000)  = 120,000 + ($23x s)

650,000 = 120,000 + 23s

650,000 - 120,000 = 23s

530,000 = 23s

s = 530,000 / 23

s = 23,043

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