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Finite Chapter 1.4

Finite Chapter 1.4 - Math 120 SP08 SBrodnick 1.4 Linear...

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Math 120 SP08 SBrodnick 1 1 1.4 : Linear Models 2 1.4: Linear Models Example : 1. A cell phone provider charges 15¢ per minute, plus a \$20 monthly fee. a. what is the monthly bill if you use 100 minutes? b. find monthly cost C if you use x minutes * Slope 0.15 is Cost per minute --» Marginal Cost is \$0.15 Varying quantity is 0.15x --» Variable Cost is \$0.15x y-intercept is 20 --» Fixed Cost is \$20 3 * Cost Function : cost C of producing x items * Linear Cost Function: C(x) = mx + b * Revenue Function : revenue R of selling x items * Linear Revenue Function: R(x) = mx * Profit Function : profit P of producing and selling x items * Profit = Revenue – Cost P(x) = R(x) – C(x) 1.4: Linear Models m arginal cost fixed cost m arginal revenue (price per item) 4 Example : 2. A t-shirt company can make 1000 t-shirts for \$1750 and 2000 t-shirts for \$2560. a. Linear cost function b. Fixed cost? Marginal cost? c. The company sells each t-shirt for \$15. Revenue function? d. Profit function? e. How many t-shirts must be sold in order to break even ? 3. (#6 P. 78) 1.4: Linear Models 5 * Demand & Supply Functions * Demand Function

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Finite Chapter 1.4 - Math 120 SP08 SBrodnick 1.4 Linear...

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