Billy's Bean Bag Emporium produced 300 bean bag chairs but sold only 275 of the units it produced. The average cost of production for each unit of output produced was $100. The price for each of the 275 units sold was $95. Total profit for Billy's Bean Bag Emporium would be

Question

Quizplus · Accepted Answer

Total cost of production = 300 x $100 = $30,000
Total revenue from sales = 275 x $95 = $26,125
Total profit = Total revenue - Total cost = $26,125 - $30,000 = -$3,875 (negative profit means a loss)

Billy's Bean Bag Emporium Produced 300 Bean Bag Chairs but Sold