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Sagot :
The cost per unit for each product is given as:
x ≈ 0.0067; and
y ≈ 0.0041. See explanation below.
What is the cost per unit for each product?
Given that the current production:
- Model Diamond (Md) - 150 Units
- Model Gold (Mg) - 245 Units
Current cost of production is given as:
Current Total Cost = 150y + 245x where;
- x is the cost of producing one unit of Model Gold, and
- y is the cost of producing one unit of Model Diamond.
if doubling the batch sizes will reduce the cost per unit by 50% then the new cost equation will be:
Thus, New Total Cost of production = (150 x 2) (y/2) + (245 x 2) (x/2)
= (300)(y/2) + (490) (x/2)
Since we are looking for the cost per unit of each product:
f(x) = 300 * (x/2)..........Unit cost of Model Gold
If we make x subject of the formula, then we arrive at:
1/300 = x/2
x = (1/300) * 2
x = 0.00666666666
x ≈ 0.0067
f(x) = 490* (x/2)
If we make y subject of the formula, then we arrive at:
i/490 = y/2
y = (1/490) * 2
y = 0.00408163265306122448979591836735
y ≈ 0.0041
Learn more about cost /unit at:
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