Solution-Compute the optimal price per unit that maximizes

Compute the optimal price per unit that maximizes profit

Assignment Help Managerial Accounting

Reference no: EM132955617

Cambrian Railways runs a daily container freight train between Cardiff and Birmingham. Its major customer Welsh Farming Co-operative has a demand for containers by the equation:

P = 410-5Q, where P is the unit selling price and Q is quantity of units in thousands.

Cambrian's total cost function is given by the equation:

TC = 3Q2 + 10Q - 100, where TC is total costs in thousands of dollars.

Required:

Problem a. Determine the output level at which profit is maximized.

Problem b. Compute the optimal price per unit that maximizes profit.

Problem c. Determine the optimal sales revenue that would maximize profit

Problem d. Calculate the maximum profit.

Problem e. Identify two factors to consider when arriving at pricing decisions within the organization.

Reference no: EM132955617

Questions Cloud

What is the maximum purchase price per unit pixon should be : What is the maximum purchase price per unit Pixon should be willing to pay the outside supplier for supplying 40,000 units of this part each year?

Compute the master budget for total manufacturing costs : The company expects to make 1,000 units of this product for 2019. Compute the master budget for total manufacturing costs related to this product.

What is the expected return on a portfolio : A stock has a beta of 1.05 and an expected return of 11 percent. A risk-free asset currently earns 2.4 percent.

What is the increase in the firm value : Assume that investors in Google pay a 15% tax rate on income from equity and a 35% tax rate on interest income. If Google were to issue sufficient debt to reduc

Compute the optimal price per unit that maximizes profit : Identify two factors to consider when arriving at pricing decisions within the organization. Compute the optimal price per unit that maximizes profit.

Characteristics and importance of financial markets : Describe why a manager needs to understand the characteristics and importance of financial markets, including their liquidity, competitiveness, and efficiency.

Explain which financial ratios would apply to the company : A recruitment company needs help explaining which financial ratios would apply to the company and which would not. State the reasons for your assertions.

Role of sub-contracting in form of relationship : What is the role of sub-contracting in this form of relationship (public-private partnership)? And describe the element of financing in public-private relations

Compute the balances necessary to prepare a budgeted balance : Paul's Pool Service provides pool cleaning, chemical application, Compute the balances necessary to prepare a budgeted balance sheet for August 31.

User Account

All Pages

Compute the optimal price per unit that maximizes profit

Reference no: EM132955617

Reference no: EM132955617

Questions Cloud

Reviews

Write a Review

Managerial Accounting Questions & Answers

Manage budgets and financial plans

Prepare a retained earnings statement

Prepare a master budget for the three-month period

Construct the companys direct labor budget

Evaluate the predetermined overhead rate

Determine the company''s bid

Compute the pool rates for the different activities

Prepare Company financial statements

Prepare an analysis of terracycles

Discuss the ethical issues

Political resources in emerging markets

Management accounting - ehsan electronics company

Assured A++ Grade

Academics

Major Subjects

Majors

Get In Touch

TERMS & POLICIES

HELP & SUPPORT