Cost, Revenue, and Profit Maximization (Using FOIL)

Cost, Revenue, and Profit

Maximization (Using FOIL)

​TIME FOR VOCAB REVIEW!

​Cost: Money spent to produce goods/services

Revenue: Money earned from selling goods/services

Profit: Revenue – Cost

Profit Maximization: The quantity where profit is highest

write this down....

Fill in the Blank

• fixed costs

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• variable cost

;

,

,

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• total revenue

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• profit-maximizing quantity of output

​What does FOIL stand for in algebra?

F = First

O = Outer

I = Inner

L = Last

💡 Use FOIL to multiply binomials like:
(x + 3)(x - 2) → ?

→ Answer: x² + x - 6

Multiple Choice

• Cost = (3x - 4)(x + 1)

• 3x² - x - 4

• 3x² - x + 4

• 3x² - x - 5

• 3x² + x - 4

Fill in the Blank

• Revenue = (5x + 2)(x + 6)

x = number of units sold

+

+

Open Ended

A company's cost function is (2x + 1)(x - 5)

a) Expand and simplify the cost function: ___________________________
 b) If x = 6 units, find the cost: ___________________________

Open Ended

The revenue function is (4x - 3)(x + 2)
 a) Expand: ______________________________________
 b) If x = 6 units, find the revenue: ___________________________

Open Ended

Using your results from slides 10b and 11b, find the profit:
Profit = Revenue - Cost = _______________

Open Ended

Exit Ticket – Short Answer

📘 In your own words:
Why is marginal revenue more important than the average revenue?