Answer
a) $C=400000+20x$
b) $R=100x$
c) $P= 80 x-400000$
d) $R(5000)=\$500000$
Work Step by Step
a) Here, the cost is the fixed cost. This means $\$ 400000$ plus $\$ 20$ per PDA.
Hence, $C=400000+20x$
b) Revenue $=\$100$ per PDA
Hence, $R=100x$
c) Profit = Revenue - Cost
That is, $P= 100x- ( 400000+20x) =80 x-400000$
d) The break-even point occurs when profit is equal to zero -- that is, $R=C$
Thus,
$P= 100x- ( 400000+20x) =80 x-400000$
$0=80 x-400000$
Hence, $x= 5000$ PDAs
At this point, $R(5000)=\$500000$
