Question

The cost and revenue functions of a product are given by C(x) = 20x + 4000 and R(x) = 60x + 2000, respectively, where x is the number of items produced and sold. How many items must be sold to realise some profit? 

Answer 1

We have, profit = Revenue – Cost

= (60x + 2000) – (20x + 4000)

= 40x – 2000

To earn some profit, 40x – 2000 > 0.

⇒ x > 50

Hence, the manufacturer must sell more than 50 items to realise some profit.