June 11, 2021

###### BUS599 – custom papers

June 11, 2021

You are thinking of opening a small copy shop. It

costs \$5000 to rent a copier for a year and costs \$0.03

per copy to operate the copier. Other fixed costs of

running the store will amount to \$400 per month. You

plan to charge an average of \$0.10 per copy, and the

store will be open 365 days per year. Each copier can

make up to 100,000 copies per year.

a. For 1 to 5 copiers rented and daily demands of

500, 1000, 1500, and 2000 copies per day, compute

annual profit. That is, compute annual profit for

each of these combinations of copiers rented and

daily demand. (10pts)

b. If you rent 3 copiers, what daily demand for copies

will allow you to break even? (10pts)

c. Graph profit as a function of the number of copiers

for a daily demand of 500 copies; for a daily

demand of 2000 copies. Interpret your graphs. (10pts

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