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# Question : 1A The cost of a smart phone \$139. Assume that

1A The cost of a smart phone is \$139. Assume that total cost to manufacture smart phones is directly porportional to the number of smart phones produced. Write an equation for total cost, C, of producing smart phones as a function of quantity produced (and sold) each quarter, q. (Hint: the cost to produce eaxh phone is the constant of porportionality.)

B Use your cost function above and the demand function you found in A as a function of price, p.

C Write an equation for the manufacturer's annual profit, P, as a function of price, p.

D At what price does the manufacturer break even with respect to the smart phone sales. The smaller value is the price at which the manufacturer breaks even because production cost for one phone equals_____of/from one phone. The larger value is the price at which the manufacturer breaks even because demand for the product drops to_____.

E According to this model what price per smart phone should the manufacturer charge in order to maximize quarterly profit? What is the maximum profit?

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