Answer:
a. What is the cost function.
C(x) = 10x + 60,000
b. What is the revenue function.
R(x) = 15x
c. What is the profit function.
P(x) = R(x) - C(x) = 15x - 10x - 60,000 = 5x - 60,000
Compute the profit loss corresponding to production level of 10,000 and 14000.
10,000 units produced:
P(10,000) = 5(10,000) - 60,000 = 50,000 - 60,000 = -$10,000
14,000 units produced:
P(14,000) = 5(14,000) - 60,000 = 70,000 - 60,000 = $10,000
