Find the point of diminishing return for the profit function

Reference no: EM131012823

1. A manufacturer has been selling 1000 television sets a week at $400 each. A market survey indicates that for each $10 rebate offered to the buyer, the number of sets sold will increase by 100 per week. Round your answers to the nearest dollar.

(a) Find the demand function (price as a function of units sold).

(b) How large a rebate should the company offer the buyer in order to maximize its revenue?

(c) If the company experiences a cost of C(x) = 68,000 + 130x, how should the manufacturer set the size of the rebate in order to maximize its profit?

2. An airline finds that if it prices a cross-country ticket at $200, it will sell 300 tickets per day. It estimates that each $10 price reduction will result in 50 more tickets sold per day. Find the ticket price (and the number of tickets sold) that will maximize the airline's revenue.

Find the point of diminishing returns for the profit function where x is the amount spent on marketing in million dollars.

P(x) = 4x + 30x² - 2.5x3; for 0 ≤ x ≤ 6.

Reference no: EM131012823

Questions Cloud

The inflation rate expected for the coming year : Because of a recession, the inflation rate expected for the coming year is only 3%. However, the inflation rate in Year 2 and thereafter is expected to be constant at some level above 3%. Assume that the real risk-free rate is r* 5 2% for all maturit..

Earning interest at the rate : When you were born, your grandfather established a trust fund for you in the Cayman Islands. The account has been earning interest at the rate of 10% per year. If this account will be worth $150,000 on your 25th birthday, how much did your grandfathe..

Why do real gases deviate from ideal behavior : Why do real gases deviate from ideal behavior at low temperatures?

What is the total revenue in millions of dollars : Consider a wind energy project that produces 399 GWh/yr and is able to sell this at a cost of $0.1/kWh. The project will also receive income in this year from the PTC, at a value of $0.023/kWh. The annual operating expenses come out to be $0.014/kWh ..

Find the point of diminishing return for the profit function : Find the point of diminishing returns for the profit function where x is the amount spent on marketing in million dollars. P(x) = 4x + 30x2 - 2.5x3; for 0 ≤ x ≤ 6.

Observations for li and na : Consider your observations for Li and Na, the first two alkali metals: each showed only a single emission line. The ground-state electron configuration for these metals is [He]2s and [Ne]3s, respectively. Since there is only one electron in their val..

Bonds that grant the issuer the right to extinguish debt : Bonds that grant the issuer the right to extinguish debt prior to maturity are referred to as which type of bond

Using the straight-line method : Scott Investors, Inc., is considering the purchase of a $371,000 computer with an economic life of four years. The computer will be fully depreciated over four years using the straight-line method. The market value of the computer will be $71,000 in ..

Determine the patent amortization expense for the current : Determine the patent amortization expense for the current year ended December 31, 2014. Journalize the adjusting entry to recognize the amortization.

User Account

All Pages