Question

The demand function for a commodity is Q=6000−30P

Q=6000−30P. Fixed costs are R72000

R72000 and the variable cost is R60 per unit produced. What are the equations for total revenue and total cost in terms of P

P?

Answer 1

$C=72000+60Q$

Where $C=$ Total cost

$Q=$ Quantity of units produced

$TR=P×Q$

Where $TR=$ Total revenue

$P=$ Price per unit item

$Q=$ Number of units sold

but $Q=6000-30P$

$\therefore\>C=72000+60(6000-30P)$

$C=432000-1800P$

$TR=P(6000-30P)$

$=6000P-30P^2$