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Can someone please solve this problem for me, it will be greatly appreciated. Thanks!!?

In Harley Company it costs $30 per unit ($20 variable and $10 fixed) to make a product that normally sells for $45. A foreign wholesaler offers to buy 4,000 units at $23 each. Harley will incur special shipping costs of $1 per unit. Assuming that Harley has excess operating capacity, indicate the net income (loss) Harley would realize by accepting the special order.

1 Answer

Relevance
  • 7 years ago
    Favorite Answer

    the "normal" price is irrelevant.

    P(x) = 23x - (20x + 10) - x

           = 2x - 10

    so

    P(4000) = $7990

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