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Cost Analysis and Profit Calculations

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9 views1 page

Cost Analysis and Profit Calculations

Uploaded by

smpmnv5429
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

Problems:

1- Company A has fixed expenses of $15,000 per year and each unit of product has a
$0.002 variable cost. Company B has fixed expenses of $5000 per year and can
produce the same product at a $0.05 variable cost. At what number of units of
annual production will Company A have the same overall cost as Company B?
2- A company manufacture small toys for 2,3 LD each and has equipment of 2500
LD. Each toy sells for 4 LD each.
a. Write the cost function, the revenue function, profit function and the
breakeven point.

3- If the firm produce 75 units of output at a total cost of 300LD. What is the
average cost?

4- At 10 unit of output, total fixed cost is 500LD and average variable cost is 25 LD.
What is average total cost.

5- A person invested 500LD at simple interest rate of 6%. How much interest will he
will earn in one month, in 6 months, in one year.

6- If you deposit LD4000 into an account paying 6% annual interest


compounded quarterly, how much money will be in the account after 5 years?

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