How Many Units Must Plant A Produce to Stay Within Budget?

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In summary, the company plans to produce 5000 units of its product at plants A and B, with a unit cost of $2.50 at plant A and $3.00 at plant B. The fixed costs are $6000 at plant A and $8000 at plant B. To stay within a budget of $28,000 for total costs, the minimum number of units that must be produced at plant A is 4000. This can be found by setting the cost equation equal to the budget and solving for A.
  • #1
hello ..

Homework Statement

A company will manufacture a total of 5000 units of its product at plants A and B. At plan A the unit cost for labor and material combined is 2.50 $, while at plant B it is 3.00 $. The fixed costs at plant A are 6000 $ and at plant B they are 8000 $. Between the two plants the company has decided to allot no more than 28,000 $ for total costs. What is the minimum number of units that must be produced at plant A ?

The Attempt at a Solution

I want to confirm my steps if it's right ,,,,

A = # units produced at plant A
B = # units produced at plant B

A + B = 5000
B = 5000 - A

Cost for plant A: 2.50A + 6000
Cost for plant B: 3.00B + 8000

(2.5A + 6000) + (3.0B + 8000) = 28000
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  • #2
You already know that B = 5000 - A. Replace this value in the last equation.
  • #3
kk ,,,,

i forgot to say it ,,, i

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