Marginal Profit

Yaster Breakfast Supplies is planning to manufacture and market a new toaster. After conducting extensive market surveys, the research department provides the following estimates:

• a weekly demand of 297 at a price of $14 per toaster
• a weekly demand of 193 at a price of $16 per toaster

The financial department estimates that weekly fixed costs will be $1,370 and variable costs (cost per unit) will be $4.

Assume:

• the relationship between price and demand is linear
• the cost function in linear

Use your models to predict the marginal profit when Yaster is producing and selling 263 toasters per week. Round to the nearest cent.

$ per toaster