# The fixed costs of producing a basketball are $25000 and the cost of raw material is $5 each. What is the number of balls that need to be produced to make the most efficient use of financial...

The fixed costs of producing a basketball are $25000 and the cost of raw material is $5 each. What is the number of balls that need to be produced to make the most efficient use of financial resources.

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To produce basketballs the initial investment in machinery, also known as fixed costs, is $25000. The cost of raw material for each ball is $5.

The total cost to produce x basketballs is C(x) = 25000 + x*5.

If the most efficient use of resources is in producing N basketballs, the solution of C'(x) = 0 is x = N and C''(N) > 0

C(x) = 25000 + x*5

C'(x) = 5

This is positive for all values of x.

From the information given, the company makes better use of its initial investment, the more number of basketballs it produces.

**In theory, the efficiency is maximized in producing an infinite number of basketballs.**