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The O'Neill Shoe Manufacturing Company will produce a special-style shoe if the order size is large enough to provide a reasonable profit. For each special-style order, the company incurs a fixed cost of $1000 for the production setup. The variable cost is $30 per pair, and each pair sells for $40.

a. Let x indicate the number of pairs of shoes produced. Develop a mathematical model for the total cost of producing x pairs of shoes.

b. Let P indicate the total profit. Develop a mathematical model for the total profit realized from an order for x pairs of shoes.

c. How large must the shoe order be before O'Neill will break even?

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Management Theories, Management Studies

Category:- Management Theories
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