Real-Life Math -- Solution
You're starting to get into production creating a new stuffed
animal that you have invented. You think it might be a popular item for sale
during the next holiday season. This is how much it will cost you to get started
with production of 150 Snazoos:
Materials = $6 x 150
Materials
= $900
Packaging = $2 x 150
Packaging = $300
Marketing and
promotional material = $4 x 150
Marketing and promotional material = $600
Shipping
= $2 x 150
Shipping = $300
Total costs = $900 + $300 + $600 + $300
Total
costs = $2,100
It will cost you $2,100 to produce the first 150 Snazoos.
If
you hope to earn a profit of $7 from each Snazoo, how much will you have to
charge customers for each of the stuffed animals?
Cost of 1 Snazoo
= $6 + $2 + $4 + $2
Cost of 1 Snazoo = $14
It will cost $14 to
produce each Snazoo.
Total price = $14 cost + $7 profit
Total price
= $21
You will need to charge $21 for each stuffed animal.