Consider ths table of values below for a business. Fill in the prote Munits prod
ID: 2811354 • Letter: C
Question
Consider ths table of values below for a business. Fill in the prote Munits producedtotal cost 110,000 116,000 122,000 128,000 134,000 140,000 146,000 152,000 and sold proft 100 120 140 160 180 80,000 96,000 112,000 128,000 144,000 160,000 176,000 192,000 200 220 240 14. What is the marginal cost? 15. What is the marginal profit? 16. What is the number of units that need to be produced and sold to "break even? 0o 17. What will be the profit from producing and selling 260 units? 18. What is the cost function? 19. What is the revenue function? 20. What is the profit function?Explanation / Answer
Units Total Cost Revenue Profit Marginal profit Marginal cost 100 110000 80000 (30000) 0 0 120 116000 96000 (20000) 10000 6000 140 122000 112000 (10000) 10000 6000 160 128000 128000 0 10000 6000 180 134000 144000 10000 10000 6000 200 140000 160000 20000 10000 6000 220 146000 176000 30000 10000 6000 240 152000 192000 40000 10000 6000 With the increase in each 20 units the marginal cost is increased by $6000 Marginal profit will and increase by $10000 with increse in sale of 20 more units. 160 units should be produced and sold foe the Breakeven point i.e. no profit no loss situation. By selling 260 units the business will earn profit of $40000. Cost function is combination of variable cost and fixed cost which is known to be total cost. for example : In producing and selling 220 units it cost $146000. So here 14600 is cost function. Revenue function is what business will get for selling its units. For example producing and selling 220 units $176000 revenue is earned Profit function is revenue subtract cost . For example producing and selling 220 units the profit of $30000 is earned.