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The Ordering and Transportation Cost C for Components Used in a Manufacturing

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The ordering and transportation cost C for components used in a manufacturing process is approximated by C(x) =27(1x,1x+2) C ( x ) = 27 \left( \frac { 1 } { x } , \frac { 1 } { x + 2 } \right) , where CC is measured in thousands of dollars and xx is the order size in hundreds. According to Rolle's Theorem, the rate of change of the cost must be 0 for some order size in the interval (4,6) ( 4,6 ) . Find this order size. Round your answer to three decimal places.

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Definitions:

Break-Even Point

The point at which total costs and total revenue are equal, resulting in no net loss or gain and all fixed costs are covered.

Selling Price

The amount of money charged for a product or service, which can influence demand and revenue.

Contribution Margin Ratio

The ratio of contribution margin to sales revenue, used to measure the profitability and efficiency of a product or service.

Margin Of Safety

The difference between the actual or expected profitability of a project and the break-even point. It is a cushion against uncertainty.

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