Question

The manufacturer of a pen fixes its selling price at ₹ 45 and the cost function is C(x) = 30x + 240. The manufacturer will begin to earn profit if he sells more than 16 pens. Why? Give one reason.

Answer 1

Revenue function, R(x) = 45x, if x piece of pens are sold.

Cost function, C(x) = 30x + 240

We will determine the breakeven points,

i.e., R(x) = C(x)

`\implies` 45x = 30x + 240

`\implies` 45x – 30x = 240

`\implies` 15x = 240

`\implies` x = `240/15` = 16

As a result, if more than 16 pens are sold, profits will be made.