nkmungila wrote:
A company produces school bags. The cost for producing the first 1,000 bags of a particular design, owing to initial expenses,
turns out to be $30 per bag. Thereafter, the cost reduces to $10 per bag. If the company produced 5,000 bags of a certain
design and sold them all at an average price of $20 per bag, which of the following will represent the best approximation for
the percentage profit earned by the company on the expenses incurred in producing these bags?
A. 10%
B. 20%
C. 30%
D. 40%
E. 50%
turns out to be $30 per bag. Thereafter, the cost reduces to $10 per bag. If the company produced 5,000 bags of a certain
design and sold them all at an average price of $20 per bag, which of the following will represent the best approximation for
the percentage profit earned by the company on the expenses incurred in producing these bags?
A. 10%
B. 20%
C. 30%
D. 40%
E. 50%
Weighted average is another good method..
Total 5000: 1000 at 30 and 4000 at 10..
So the average cost = \(10+(30-10)*\frac{1000}{5000}=10+4=14\)
So profit =20-14=6
Profit%=6/14*100=300/7=43%~40%
D