Question

Suppose that for a company manulacturing calculators, the cost, fevenue, and profit equations are piven by

C = 90,000+30x, R = 300x − x²/20 ,P=R−C A) Conts are (simplity your answer. ) at the rate of 5 per week at this production level.

Answer 1

To calculate profit, the cost is subtracted from the revenue. When total revenue equals total cost, the profit is zero. When total revenue exceeds total cost, the firm experiences a profit.

Step-by-step explanation:

The question presents a scenario wherein a company is manufacturing calculators and has equations for cost (C), revenue (R), and profit (P) already defined. To calculate profit based on these equations, one would deduct the total cost from the total revenue. According to the examples provided, if a farm's total revenue with a price at a certain level leads to an area that exactly matches the total cost area on the graph, then the firm breaks even, making zero profit, as illustrated by the calculation (75)($2.75) - (75)($2.75) = $0.

Another example shows the firm experiencing a loss when total revenues of $125 (price of $25/unit multiplied by five units) are less than total costs of $130, resulting in negative profits of $5.

The third situation describes a firm that is making economic profits since the price lies above the average cost curve. The calculations demonstrate profits of $60 based on a total revenue of $640 and a total cost of $580, at an output of 40 units.