XYZ companys cost function for the next four months is

C = 500,000 + 5Q
Find the BE dollar volume of sales if the selling price is br. 6 / unit
What would be the companys cost if it decides to shutdown operations for the next four months
If, because of strike, the most the company can produce is br. 100,000 units, should it shutdown? Why or why not?

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In cost analysis, companies often use cost functions to determine various aspects of their operations. For example, XYZ company's cost function for the next four months is given by C = 500,000 + 5Q, where Q represents the quantity of units produced. By plugging in the selling price of br. 6 per unit, we can calculate the break-even (BE) dollar volume of sales. Moreover, if the company decides to shutdown operations for the next four months, the cost would be different. Lastly, if a strike limits production to br. 100,000 units, it might be necessary to assess whether a shutdown is advisable or not, considering the cost implications. The decision should be based on evaluating the potential losses and comparing them to the benefits of keeping the company running during the limited production period.