Cost Revenue And Profit Functions Problems

Profit r c.

Cost revenue and profit functions problems. B compare the level of production to maximize profit with the level to maximize revenue see problem 7. Profit is defined to be revenue minus cost so the profit function is. To perform marginal analysis on either profit revenue or cost find the derivative function for the one quantity out of these three that you are estimating for. A form the profit function for the cost and revenue functions in problem 3 and find the maximum profit.

Of up to 150. Profit is the difference between cost and revenue. If mp x 0 then it s profitable to increase product level x other wise it s profitable to decrease product level if m p x o. If q items are sold i e the demand is q at the price p then the revenue is r pq.

P r c. The profit function is just the revenue function minus the cost function. Calculating the profit function. Since the manufacturer sells the jerseys for 90 each the revenue function is b find the profit function.

If the cost per item is fixed it is equal to the cost per item c times the number of items produced x or c x c x. The derivatives of these quantities are called marginal profit function marginal revenue function and marginal cost function respectively. If r x is the total revenue and c x is the total cost then profit function p x. For our simple lemonade stand the profit function would be.

Solving problems involving cost revenue profit the cost function c x is the total cost of making x items. Earl s biking company manufactures and sells bikes. The excess of total revenue over the total cost of production is called the profit. In addition earl knows that the price of each bike comes from the price function find.

Its cost in dollars for a run of hockey jerseys is a gymnast clothing sells the jerseys at 90 each. The price function p x also called the demand function describes how price affects the number of items sold. Each bike costs 40 to make and the company s fixed costs are 5000. P x 0 3.

Profit 0 50 x 50 00 0. Find the revenue function. If every cookie cost 50 cents to make our revenue function becomes. Cost revenue and profit functions.

C 50 0 10 x lemonade 0 50 x cookie. Iii profit function p x b calculate the daily profit if the factory sells 1200 bags of biscuits daily.