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How many units must be sold each year for the company

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Reference no: EM132722172

Problem 1: A company has determined that the price range and the monthly demand of one its products are related by the equation

d = 475 in square root - p

where P is the price per unit in dollars and D is the monthly demand. The associated fixed costs are $1,400/month, and the variable

costs are $175/unit.

What is the optimal number of units that should be produced and sold each month? Choose the closest answer below.

A. 17

B. 23

C. 24

D. 12

Problem 2: When you were born, your grandfather established a trust fund for you in the Cayman Islands. The account has been earning interest at the rate of 7% per year. If this account will be worth $90.000 on your 23th birthday, how much did your grandfather deposit on the day you were born?

A. $7,074

B. $6,300

C. $6,448

D. $3,913

E. $18,985

Problem 3: A manufacturing company leases a building for $110,000 per year for its manufacturing facilities. In addition, the machinery in this building is being paid in installments of $19,000 per year. Each unit of product produced costs $16 in labour and $9 in materials. The product can be sold for $40. How many units must be sold each year for the company to earn a profit of $63,000 per year?

A. 17,920

B. 20,480

C. 12,800

D. 15,360

E. 7,680

Reference no: EM132722172

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