Estelle is a budding entrepreneur who is using her skills to fundraise for Ukraine. She’s making custom T-shirts with e

[answerhappygod]

Estelle is a budding entrepreneur who is using her skills to
fundraise for Ukraine. She’s making custom T-shirts with
entertaining designs (“Puck Futin,” “Slava Ukraina,” etc.) and
selling them online. 50% of the profits will go towards
humanitarian food relief, while the other 50% will go towards
buying bulletproof armor to send to Ukrainian troops.
That split isn’t important to this problem, but I figured I’d let
you know where money will go…
Anyhow, Estelle first prices the shirts for $20 each, and sells
4,000 shirts. Based on her earlier experience (she
produced similar fundraising shirts to donate to BLM and Earth
Justice) she knows that each time she lowers the price by 15 cents,
she’ll sell 40 more shirts, and commensurately lose sales if she
raises the price.
Each shirt costs her $4 for the
blank, $1 for the custom printing, $3 in labor, and $4 for
shipping. Her fixed costs for website startup are
$20,000.
Please make a simple model showing how your choice of price
affects your profit
Question 1: Use your model to show the expected profit if
she keeps the price at $20. What is that profit?