When the Price of a Glass of Lemonade at a Lemonade

question 44

Multiple Choice

When the price of a glass of lemonade at a lemonade stand was $1.75, 400 glasses were sold. When the price was lowered to $1.50, 500 glasses were sold. Assume that the demand function is linear and that the marginal and fixed costs are $0.10 and $ 25, respectively. Find the profit P as a function of x, the number of glasses of lemonade sold.

• A) \(P = - 0.0025 x ^ { 2 } + 2.65 x - 25\)
• B) \(P = 0.0025 x ^ { 2 } + 2.65 x - 25\)
• C) \(P = - 0.0025 x ^ { 2 } + 2.65 x + 25\)
• D) \(P = 0.0025 x ^ { 2 } - 2.65 x - 25\)
• E) \(P = - 0.0025 x ^ { 2 } + 2.65 x + 25\)

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Definitions:

Free Cash Flow

The cash a company generates after accounting for cash outflows to support operations and maintain its capital assets.

Cash Reinvested

Funds that a company allocates back into its business for growth purposes, such as expanding operations or purchasing new equipment.

Net Cash Flow

The disparity between what a business earns and spends in cash over a designated timeframe.

Dividend Payments

The portion of a company's earnings that is distributed to shareholders, usually in the form of cash or additional shares.