Question

The manufacturer of computers spends $500 to make each computer and sells them for 800. The manufacturer also has fixed costs each month of $5700. Find the cost function C when x computers are manufactured.

Answer 1

C(x)=500x+5700.

Explanation:

he general Cost function formula is given by

C(x)=cost per unit⋅x+fixed costs.

The manufacturer has fixed costs of $5700 no matter how many computers it produces. In addition to the fixed costs, the manufacturer also spends $500 to produce each computer. If we substitute these values into the general cost function, we find that the cost function when x computers are manufactured is given by

C(x)=500x+5700.

Answer 2

C(x) = 5700 + 500x

Explanation:

Total cost = fixed cost + variable cost

Fixed cost are cost that do not change in the process of production such as machineries, furnitures & fittings.

Variable cost are cost that changes with production such as cost of raw material, cost of labor.

From the question:

Fixed cost= $5,700

Cost per unit of computer = $500

If x number of computers are produced in a month

Variable cost = 500x

Total cost = fixed cost + variable cost

C(x) = 5700 + 500x

Where,

C(x) = total cost

5700= fixed cost

500x= variable cost