Suppose that the revenue y from selling x units of a certain commodity is given by the formula y equals 4 x. (Revenue is the am
ount of money received from the sale of the commodity.) The line y equals 4 x intersects the line of cost, y equals 2 x plus 4000, at the point (2000,8000). What interpretation can be given to the value of the x-coordinate of the point of intersection?
1 answer:
Answer:
The x-coordinate of the intersection point represents the number of units for which the profit is 0.
Explanation:
The given revenues function is
The cost function is
It is given that graph of both function intersect each other at (2000,8000).
Intersection point of cost and revenues function represents that the total cost and total revenue are equal.
Profit = Total revenue - Total cost
Profit = TR - TC
Profit = TR - TR (TR=TC)
Profit = 0
The x-coordinate of the intersection point represents the number of units for which the profit is 0.
x-coordinate of the intersection point = 2000
The profit is 0 if the number of units is 2000.
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