Question

A cafeteria which offers pastries to its customers sells them at P 60 per dozen. In producing pastries, it incurs a semi-annual fixed cost of P 2,400 and an average variable cost of P 3 per piece. (1) How many pastries should the cafeteria produce to earn profits? (2) If a customer orders two hundred dozens of pastries in a year at 10% discount on its price per piece, should the owner accept the order? Why?

Answer 1

1) Per year more then 2400

$$3x+4800=(60/12)x$$

$$2x=4800$$

$$x=2400$$

2)

$$0.9\times2000\times5-4800-3\times2000=-1800$$

No, because he will have lost 1800 peso