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Mandy finds she can get a discount on corn cobs if she buys in bulk. She can get 100 kilograms of corn cobs for $160 from Matt, on condition that she buys at least 100 kilograms. From another supplier, Robert, she can buy small quantities of corn cobs (100 or less) for $1 per cob or larger quantities (more than 100) for $0.60 per cob. Mandy charges all of her customers by weight, so she gets $5 per kilogram of corn cobs or $1.25 for an individual corn cob. If Mandy is going to sell over 100 kilograms of corn cobs today, what is the best profit per corn cob she can make?
Let's break this down step by step to determine the best profit per corn cob for Mandy:
Purchase from Matt:
Cost for 100 kilograms of corn cobs from Matt: $160
Cost per kilogram: $160 / 100 kg = $1.60
Purchase from Robert:
For small quantities (100 or less) from Robert: $1 per cob
For larger quantities (more than 100) from Robert: $0.60 per cob
Selling price:
Selling price per kilogram: $5
Selling price per individual corn cob: $1.25
To maximize profit, Mandy should compare buying from Matt versus buying from Robert in bulk (more than 100 cobs).
When buying from Matt at $1.60 per kilogram, the cost per cob is $1.60 / 5 = $0.016 per cob.
When buying from Robert in bulk at $0.60 per cob and selling at $1.25 per cob, the profit per cob would be $1.25 - $0.60 = $0.65.
Therefore, the best profit per corn cob Mandy can make is $0.65 by buying in bulk from Robert ($0.60 per cob) and selling at $1.25 per cob.