Question

A baker rents space in a commercial kitchen for $210 per week. For each pie he bakes, he spends $4 on materials. He charges $7.50 per pie. The graph below shows the baker's costs and revenues for a week in which he sells p pies.

Answer 1

The total profit function for the baker, who rents a commercial space, is $3.50p - $210.

What is the profit function?

The profit function is a mathematical expression of the relationship between the baker's total profit based on his sales revenue from pie per week vis-a-vis his total costs.

The total profit function equals the total revenue minus the total costs.

The total costs are made up of variable and fixed costs.

Data and Calculations:

Fixed costs = $210 per week

Variable cost per unit = $4

Selling price per unit = $7.50

p = number of pies sold

Total profit function = ($7.50 - $4)p - $210

= $3.50p - $210

Question Completion?

What is the total profit function?

The total profit function for the baker, who rents a commercial space, is $3.50p - $210.

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