A television manufacturer produces 600 units of a certain model each month at a cost to the manufacturer of $90 per unit and all of the produced units are sold each month. What is the minimum selling price per unit that will ensure that the monthly profit (revenue from sales minus the manufacturer's cost to produce) on the sales of these units will be at least $42,000?
A$110
B$120
C$140
D$160
E$180
OA D
Source: Official Guide
Target Test Prep is 20% off right now!
Use code FLASH20
Available with Beat the GMAT members only code
MORE DETAILS
A television manufacturer produces 600 units of a certain
This topic has expert replies
-
BTGmoderatorDC
- Moderator
- Posts: 7187
- Joined: Thu Sep 07, 2017 4:43 pm
- Followed by:23 members
GMAT/MBA Expert
-
Scott@TargetTestPrep
- GMAT Instructor
- Posts: 7254
- Joined: Sat Apr 25, 2015 10:56 am
- Location: Los Angeles, CA
- Thanked: 43 times
- Followed by:29 members
We can let p = the selling price per unit and create the following equation:BTGmoderatorDC wrote:A television manufacturer produces 600 units of a certain model each month at a cost to the manufacturer of $90 per unit and all of the produced units are sold each month. What is the minimum selling price per unit that will ensure that the monthly profit (revenue from sales minus the manufacturer's cost to produce) on the sales of these units will be at least $42,000?
A$110
B$120
C$140
D$160
E$180
OA D
Source: Official Guide
600p - 600(90) ≥ 42,000
600p - 54,000 ≥ 42,000
600p ≥ 96,000
p ≥ 160
Since p ≥ 160, we see that the minimum selling price must be $160.
Answer: D
Scott Woodbury-Stewart
Founder and CEO
[email protected]
See why Target Test Prep is rated 5 out of 5 stars on BEAT the GMAT. Read our reviews
