Question

The Naturally Made Bath and Body store pays $550 a month for rent and utilities. The average cost for its products to be manufactured is about $3.00 an item. If the average price for a product sold in the store is $5.50, what will the break-even point be? Let x represent the number of products sold. The cost function that represents the situation is . The revenue function that represents the situation is

Answer 1

The cost function that represents the situation is C(x)=550+3.00x

The revenue function that represents the situation is R(x)=5.50x

Answer 2

To determine the equation to represent this situation, we can use 2.5x to show the amount of profit per product, and a y intercept value of -550 to show the cost for rent. Now, we have the equation y=2.5x-550.

The break even point is when the profits balance out the expenses, so in this case, y should equal 0.

0=2.5x-550

Add 550 to both sides...

550=2.5x

Divide both sides by 2.5...

x=220

So, our answer is 220 products.