Class ID: ____ Name: __________________________ u____________
Midterm 2 – Makeup Problem
Instructions:
Complete this problem individually. You may use your notes and/or textbook, but no other outside
sources. You should work alone. You should NOT discuss this problem with anyone else. You may
NOT get help at the tutoring center or from a tutor. You may use a calculator. Make sure to
show the work that supports your answer on a copy of this page printed from a computer. Be sure
that your work is organized and legible.
This must be turned in by 8:35am on Monday, April 8th. I will not accept late submissions for
any reason. I will accept early submissions. You can earn up to 15 points on Midterm 2, but not
more than the difference of 90 and your score.
⎛ 3
⎞
1. Suppose a company has fixed costs of $4500 and variable costs of ⎜⎝ 2 x −156⎟⎠ dollars
⎛
1 ⎞
per unit, where x=total # of units produced. Suppose that its selling price is ⎜⎝ 362 − 2 x ⎟⎠
€
dollars per unit.
a) What is the minimum cost?
b) How many units must be sold to get the maximum revenue?
€
c) Find the profit function, P(x). Write your answer in standard form.
d) What is the maximum profit?
e) How many units must be sold to breakeven?