During production process, we may encounter with some defective items in spite of all preventive measures. The defective items are either rejected immediately at the time of production or reworked and sold as good ones or customers are given enough refund to maintain the goodwill of the company. Here, no. of defective items is assumed to be some fraction of production. Moreover higher price of a product trims down the demand and vice versa. Also in the market, it is seen that large stacks of consumer goods display lead the customers to buy more. The article considers this realistic situation and involves price-sensitive stock dependent demand. As production advances, we have defective items as a part of outcome. So production rate is one of the key features for the present model while calculating the profit. Cycle time and retail price are the very obvious factors affecting the profit. Hence, maximum total profit is achieved with respect to production rate, cycle time and retail price. When there are no defective items in production process, the optimal results are obtained as well.