An electromechanical machine manufacturer has a demand function for his machines: P(q) = 5,500 - 20q, where "P" represents Selling Price in $ and "q" represents number of machines sold in a given period. Additionally, it is known that Cost Function is given by: C(q) = 500q + 5q² a) How many machines must be sold in a period to obtain a profit of $500,000? b) How many machines must be sold to obtain a MAXIMUM profit per period and what would be MAXIMUM revenue achieved?
An electromechanical machine manufacturer has a demand function for his machines: P(q) = 5,500 - 20q, where "P" represents Selling Price in $ and "q" represents number of machines sold in a given period. Additionally, it is known that Cost Function is given by: C(q) = 500q + 5q² a) How many machines must be sold in a period to obtain a profit of $500,000? b) How many machines must be sold to obtain a MAXIMUM profit per period and what would be MAXIMUM revenue achieved?
Chapter11: Profit Maximization
Section: Chapter Questions
Problem 11.9P
Related questions
Question
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 4 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
Managerial Economics: Applications, Strategies an…
Economics
ISBN:
9781305506381
Author:
James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:
Cengage Learning
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning