A company has a capacity of producing 50,000 units of a certain product in a month. The sales department reports that the following schedule of sale prices is possible:
|
Volume of Production |
Selling Price Per Unit |
|
Re |
|
|
60% |
0.95 |
|
70% |
0.90 |
|
80% |
0.85 |
|
90% |
0.75 |
|
100% |
0.60 |
The variable cost of manufacture between these levels is Re 0.20 per unit and the fixed cost is Rs 15,000. At which volume of production will the profit be the maximum?