Question
A young graduate plans to start a cupcake business using online advertisements to promote sales. It is discovered that there will be a sale
A young graduate plans to start a cupcake business using online advertisements to promote sales. It is discovered that there will be a sale of 10,000 items if the price of 1 cupcake is set at RM2.50. However, an additional 2,000 items will be sold for every 10 cents price reduced below RM2.50. Given that the fixed cost is RM3,500, and the cost of production per item is RM0.90. Determine a. the profit function, b. the amount of profit if 100 cupcakes are sold, and c. the break-even quantity.
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Engineering economy
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