Question

The cost of producing x units of a product is C dollars, where C is given by the function C = 0.25x2 - 80x + 30000. (See the graph provided.) How many units should be produced to generate the lowest cost? A) 40 units B) 80 units C) 160 units D) 240 units

Answer 1

To determine the units needed to have the lowest cost, we need to do minimization of the equation of cost. We get the first derivative of the equation and equate it with zero. Then, determine the value of x.

C = 0.25x2 - 80x + 30000
C' = 0.5x - 80 = 0
x = 160 units

Hope this answers the question.