Answer to Question #72047 in Economics for elvia

Question

Super Strength Inc. has found that the relationship between their sales and their net profit can be described by a polynomial function G(x) in which x is their sales (in thousands of dollars) and G(x) is their net profit (in thousands of dollars). What would be an appropriate domain for this function?

Answer 1

So, net profit calculate next general formula:

Net profit = Total Revenue – Total Expenses

And would be an appropriate next domain:

G(x)=x-(Cpr+Mexp+Cexp+Co+T), where x - sales, Cpr – cost price,
Mexp – management expenses, Cexp – commercial expenses, Co – other expenses, T – taxes.

All expenses are allocated to a separate coefficient K.

K=Cpr+Mexp+Cexp+Co+T

So, domain for this function will have the following form: G(x)=x-K

Answer
The answer of this question is G(x)=x-K. Net profit is directly proportional to sales.