Cost, Revenue and Profit Functions
This section introduces the fundamental concepts of cost, revenue, and profit functions in business economics. It provides a practical example of calculating these functions for a manufacturing company.
The problem presents a third-degree polynomial cost function K(x) = ax³ + bx² + cx + d, where x represents the production quantity. Fixed costs are given as 24 GE (monetary units), and revenue per unit is 22 GE. The task involves calculating various aspects of this business scenario.
Vocabulary: GE (Geldeinheit) - Monetary unit, ME (Mengeneinheit) - Quantity unit
Example: 1 GE = 1,000 EUR, 1 ME = 1,000 pieces
The problem is broken down into several steps, including:
a) Calculating the total cost function
b) Determining the revenue function
c) Graphing the cost and revenue functions
d) Deriving the profit function
e) Calculating break-even points
f) Graphing the profit function
g) Estimating the maximum profit
h) Determining the variable unit cost function
Highlight: This comprehensive problem covers all major aspects of cost, revenue, and profit analysis, providing a practical application of these concepts.