A tire manufacturer estimates total production costs to be 2

A tire manufacturer estimates total production costs to be $289,000 + $56 per tire made. The company market analysis expert has predicted sales volume based on the price of the tire as shown in the table below. Assuming that production is limited to the options shown in the table, what is the company\'s maximum monthly profit? Express your answer in $ to the nearest $1,000.

Tire Cost $                 Sales per Month
$90                                100,000
$100                                95,000
$110                                 80,000
$120                                 65,000
$130                                 45,000

Solution

COMPANY\'S MONTHLY PROFIT IS MAXIMUM WHEN TIRE PRICE=$110 ANS SALES ARE 80000, company\'s maximum monthly profit is 4031000