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Business Mathematics: Equilibrium & Profit Analysis

This document contains a series of business mathematics problems related to demand and supply functions, cost and revenue functions, and profit calculations. It includes tasks such as finding equilibrium prices, calculating changes in demand, and determining break-even points for various scenarios. The problems require the application of mathematical concepts to analyze business operations and financial outcomes.

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Nurul Ain
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6 views2 pages

Business Mathematics: Equilibrium & Profit Analysis

This document contains a series of business mathematics problems related to demand and supply functions, cost and revenue functions, and profit calculations. It includes tasks such as finding equilibrium prices, calculating changes in demand, and determining break-even points for various scenarios. The problems require the application of mathematical concepts to analyze business operations and financial outcomes.

Uploaded by

Nurul Ain
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

EIB10503 BUSINESS MATHEMATICS

Tutorial 2

1. The demand function for a product is given by D( p)=200−5 p and the supply function
is S( p)=20+ 3 p where p is the price per unit in dollars. Find the equilibrium price and
quantity.

2. Given the demand function D ( p )=120−4 p and the supply function S ( p )=40+2 p ,
calculate the change in demand if the price increases from $15 to $20.

3. Assume that the fixed cost is RM 850, the variable cost per item is RM 45, and the
selling price per unit is RM 65. Determine
a) Cost function
b) Revenue function
c) Profit function

4. A company’s cost function is C (x)=500 +2 0 x and its revenue function is R(x )=50 x
where x is the number of units sold.

a) How many units must the company sell to break even?


b) What is the company’s profit or loss if 250 units are sold?
c) How many units must be sold if the company needs to achieve a profit of RM 1,500?

5. A company produces and sells a product; its fixed costs are RM 6,000, and its variable
cost is RM 25 per unit. The company sells the product at RM 50 per unit.

a) Find the total cost function.


b) Find the total revenue function.
c) Find the profit function, and determine the profit when 1000 units are sold.
d) How many units must be produced and sold to yield a profit of RM 10,000?

6. A company’s revenue function for producing x units is given by R(x )=200 x−4 x 2.
Determine the production level that maximizes revenue and calculate the maximum
revenue.

7. The revenue function for a product is R( x )=180 x−2 x 2 and the cost function is
C (x)=50 x +1000. Determine the production level x that maximizes profit and find the
maximum profit.

8. Cost function and revenue function of a company are as follows, where x is the number
of units produced and sold:

TR=8 x , TC=6 x +1,400


EIB10503 BUSINESS MATHEMATICS

Calculate the break-even number of units.

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