Jose is going to order wrenches for his hardware store. He can order four different types and the table shows the profit margin
for each type in tens of dollars and the probability. Which wrench should he order?
1 answer:
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Answer:
- Purchase fewer than 15 jerseys from Print It; purchase more than 15 jerseys from Top Print; purchase exactly 15 jerseys from any supplier
- Value Printing could charge a $15 one-time charge and $20 per jersey
Step-by-step explanation:
1. For x jerseys, the cost from Print It is $21 each, so ...
p = 21x
The cost from Top Print is less per shirt, but has a set-up charge. Its cost can be modeled by ...
t = 45 +18x
These two costs will be the same when ...
p = t
21x = 45 +18x
3x = 45
x = 15
Purchasing 15 shirts from either supplier will cost $21·15 = $315. The lower per-jersey cost at Top Print will come into play if more than 15 shirts are ordered.
- Bill should order fewer than 15 shirts from Print It, and more than 15 shirts from Top Print.
- An order of exactly 15 shirts will cost the same from any supplier.
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2. Value Printing wants their pricing to be somewhere between the prices of the other two shops. That means their per-jersey cost will be somewhere between $18 and $21, and their setup cost will be less than $45. It also means their cost for 15 jerseys must be exactly $315, as it is for both other shops.
If we choose a per-jersey cost of $20 for Value Printing, then the setup cost must be ($315 -$20×15) = $15 in order for the cost of 15 jerseys to match the cost at the other shops. With these choices, at Value Printing, ...
- pay a one-off setup cost of $15
- then each jersey will cost $20
