A large wood products company is negotiating a contract to sell plywood overseas. The fixed cost that can be allocated to the production of plywood is $900,000 per month. The variable cost per thousand board feet is $131.50. The price charged will be determined byp = $600 – 0.05D per thousand %3D board feet.

Elements Of Electromagnetics
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ISBN:9780190698614
Author:Sadiku, Matthew N. O.
Publisher:Sadiku, Matthew N. O.
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PROBLEM #2
A large wood products company is negotiating a contract to
sell plywood overseas. The fixed cost that can be allocated to
the production of plywood is $900,000 per month. The
variable cost per thousand board feet is $131.50. The price
charged will be determined byp = $600 – 0.05D per thousand
board feet.
a. What is the optimal monthly sales volume for this product
and calculate the profit or loss at the optimal value.
b. What is the profitable range of the demand during the
month?
Transcribed Image Text:PROBLEM #2 A large wood products company is negotiating a contract to sell plywood overseas. The fixed cost that can be allocated to the production of plywood is $900,000 per month. The variable cost per thousand board feet is $131.50. The price charged will be determined byp = $600 – 0.05D per thousand board feet. a. What is the optimal monthly sales volume for this product and calculate the profit or loss at the optimal value. b. What is the profitable range of the demand during the month?
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