Given the Cost Function, C(x), and the Revenue Function, R(x)

question 119

Multiple Choice

Given the cost function, C(x) , and the revenue function, R(x) , find the number of units x that must be sold to break even.
-What is the profit when 796 binoculars are produced?

• A) $3092
• B) $92
• C) $4684
• D) $1684

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Definitions:

Fixed Costs

Costs that do not vary with the level of output or sales, such as rent, salaries, and insurance premiums.

Break-Even Point

The sales level at which total revenues equal total costs, resulting in no profit but no loss.

Contribution Margin

The amount remaining from sales revenue after variable expenses have been deducted, showing how much contributes to fixed expenses and profits.

Sales Mix

Sales mix refers to the proportion of different products or services sold by a company, impacting its overall profitability and performance.