Q1 It costs a baker a fixed cost of $420 and variable cost of $2.10 per cupcake.A cupcake is sold for $4.90 each. The cost of producing 20,40,60,80 and 100 cupcakes.Cost of producing cupcakesQuantityTVC ($)TFC($)TC (TFC+TVC)2042 (2.1 * 20)42046240844205046012642054680168420588100210420630Revenue from SellingQuantityPriceTR204.998404.9196604.9294804.93921004.9490(i) Write an algebraic expression representing the revenue R as a function of the number of cupcakes x sold. (ii) Graph both functions on the same coordinate axes. (iii) From your graph find coordinatae at which cost equals revenue. (vi) Using your graph,determine how many cupcakes need to be made to produce revenue of at least $1,029.How much profit is made for this number of cupcakes?

According to guidelines, first 3 subparts needs to be solved. Profit maximisation is done by…

Answered: Q1 It costs a baker a fixed cost of…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Q1

It costs a baker a fixed cost of $420 and variable cost of $2.10 per cupcake.A cupcake is sold for $4.90 each. The cost of producing 20,40,60,80 and 100 cupcakes.

Cost of producing cupcakes

Quantity	TVC ($)	TFC($)	TC (TFC+TVC)
20	42 (2.1 * 20)	420	462
40	84	420	504
60	126	420	546
80	168	420	588
100	210	420	630

Revenue from Selling

Quantity	Price	TR
20	4.9	98
40	4.9	196
60	4.9	294
80	4.9	392
100	4.9	490

(i) Write an algebraic expression representing the revenue R as a function of the number of cupcakes x sold.

(ii) Graph both functions on the same coordinate axes.

(iii) From your graph find coordinatae at which cost equals revenue.

(vi) Using your graph,determine how many cupcakes need to be made to produce revenue of at least $1,029.How much profit is made for this number of cupcakes?

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