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Cost and profit precalculus math problem- EXPLAIN HOW YOU ACHIEVE THE ANSWER!!?
An electronics company produces a car stereo for which the variable cost is $5.60 and the fixed costs are $24,000. The product sells for $99.50. Write the cost C as the function of x. Write the profit P as a function of x.
Answer: C= 5.6x + 24,000
P= 93.9x-24,000
I know the answer ^^^
But I don't know how to find it!
I also don't know what the difference is between fixed cost and variable cost
1 Answer
- Anonymous1 decade agoFavorite Answer
What is x ? The number of car stereo's made ? Given your answers, that's the only thing that would make sense for x.
Assuming that being the case.
The cost incurred by your electronics company = Total Cost incurred for producing x car stereo's + the fixed cost
=> C = (5.60 * x) + 24,000 = 5.6x + 24000
The Profit generated by your electronics company = Total Profit generated for selling x car stereo's - the fixed cost
=> P = ((selling price - variable cost) * # car stereo's made) - 24000
=> P = ((99.50 - 5.60) * x) - 24000
=> P = (93.90) * x) - 24000
=> P = (93.90x) - 24000
=> P = 93.90x -24000
What is fixed cost for your electronics company ??
Fixed cost incurred by the electronics company is indicated to be $24000. This means irrespective of how many car stereos are produced, the electronics company ALWAYS incur a fixed cost of $24,000. i.e., the fixed cost is not tied to production of car stereos. Even if the electronic company were to manufacture NO CAR STEREOs, the company will still incur a cost of $24,000. This is usually the salary paid, rental expense, electricity bill, etc.
What is variable cost for your electronics company ?
Variable cost incurred by the electronics company is tied to the number of car stereo's that are manufactured by the electronics company. i.e., the cost varies and the cost incurred is a variable of the number of car stereos made. Usually the cost incurred is for buying the components that make up the car stereo. The electronics company produces a car stereo for which the variable cost is $5.60.
This means to produce 1 car stereo,
the company spends $5.60 towards variable cost + $24000 towards fixed cost. (Total spent = $24005.60)
To produce 2 car stereos,
the company spends (2 * $5.60 = $11.20) towards variable cost + $24000 towards fixed cost. (Total spent = $24011.20)
To produce 10000 car stereos,
the company spends (10000 * $5.60 = $56000.00) towards variable cost + $24000 towards fixed cost. (Total spent = $80000.00)