A triple A battery manufacturer determines that at a price of K50 50 units of the triple A batteries are sold, further analysis showed that at a price of K60, 40 units are sold. The manufacturer also determines that the fixed costs of producing x units of the triple A type of batteries is 300 and the variable costs are 20. a. Determine i The price function in terms p = mx ii. The total revenue function "R(x)" iii. The total cost function C(x) Find the profit function "(x)" b. Under what conditions will the firm break-even c. Determine algebraically at break-even for quantity i The total revenue The total cost ii. 9 d. On the same graph sketch the R(x) and C(x), indicating clearly the break-even points From "d", giving a reason for your answer, which break-even values are feasible for business sustenance e. 0 [1] iv. 0 77 0 £ Using your result in "e" at what price should the batteries be sold at to break-even as the case of "d" On a separate graph, search the profit function (x) 99 0

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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QUESTION ONE
A triple A battery manufacturer determines that at a price of K50 50 units of the triple A
batteries are sold, further analysis showed that at a price of K60, 40 units are sold.
The manufacturer also determines that the fixed costs of producing x units of the triple A type of
batteries is 300 and the variable costs are 20.
a. Determine
i.
The price function in terms p = mx
ii. The total revenue function "R(x)"
iii. The total cost function C(x)
Find the profit function "(x)"
b. Under what conditions will the firm break-even
c. Determine algebraically at break-even for quantity
i.
The total revenue
The total cost
11.
d. On the same graph sketch the R(x) and C(x), indicating clearly the break-even points
e. From "d", giving a reason for your answer, which break-even values are feasible for
business sustenance
7
11.
0
f. Using your result in "e" at what price should the batteries be sold at to break-even as the
case of "d"
g. On a separate graph, search the profit function (x)
h. From your graph "f how many units maximizes the revenues and minimizes the costs
i. From your graph "g", how many units maximizes the profits
j. What is the maximum revenue and profit and minimum costs in the case of g" and "f"
k. When revenue is maximized, determine
i.
The selling price of the triple A battery
The cost of production
ii.
1. When profits are maximized, determine
i.
0
_[1] iv.
0
The selling price of the triple A battery
The cost of production
7
0
99,
99-97
77 77
Transcribed Image Text:QUESTION ONE A triple A battery manufacturer determines that at a price of K50 50 units of the triple A batteries are sold, further analysis showed that at a price of K60, 40 units are sold. The manufacturer also determines that the fixed costs of producing x units of the triple A type of batteries is 300 and the variable costs are 20. a. Determine i. The price function in terms p = mx ii. The total revenue function "R(x)" iii. The total cost function C(x) Find the profit function "(x)" b. Under what conditions will the firm break-even c. Determine algebraically at break-even for quantity i. The total revenue The total cost 11. d. On the same graph sketch the R(x) and C(x), indicating clearly the break-even points e. From "d", giving a reason for your answer, which break-even values are feasible for business sustenance 7 11. 0 f. Using your result in "e" at what price should the batteries be sold at to break-even as the case of "d" g. On a separate graph, search the profit function (x) h. From your graph "f how many units maximizes the revenues and minimizes the costs i. From your graph "g", how many units maximizes the profits j. What is the maximum revenue and profit and minimum costs in the case of g" and "f" k. When revenue is maximized, determine i. The selling price of the triple A battery The cost of production ii. 1. When profits are maximized, determine i. 0 _[1] iv. 0 The selling price of the triple A battery The cost of production 7 0 99, 99-97 77 77
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