Thus the profit of the manufacturer is 240000$ per month
It is given that a product costing 60 cents per unit to produce had been selling at the average rate of 1,200,000 units per month.
After the product was improved, sales increased to an average of 2,000,000 units per month.
It is also given that the new product cost five percent more to produce.
If the manufacturer's selling price in each instance was 75 cents per unit, We are required to find what was the manufacturer's added profit per month with the newer product.
Cost price is the price which the manufacturer pays for each unit
It is given that the cost price of new version is 5 percent more than the previous one.
Thus, the cost price of each unit of product = 60 cents +5 percent of 60 cents = 60+5/100*60=63 cents
It is also given that selling price of each unit is 75 cents
Profit=selling price- cost price
= 75-63= 12 cents
Thus, total profit on selling the 2000000 products= 2000000x12cents
Now we know that 100 cents = 1 dollar
Thus the profit in dollars will be = 2000000*12/100=240000
Thus the profit of the manufacturer is 240000$ per month
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