Given that p is the daily rental charge and n(p) be the number of boats rented per day.
The number of boats rented per day is modelled by the linear function n(p) = 950 – 2p.
The revenue is obtained as follows:
Obtain the daily rental rate at which the revenue will be maximum.
The objective is to find the value of p at which the revenue R(p) will be maximum.
The value of p at which R’(p) = 0 and R’’(p) < 0 maximizes the revenue.
The daily rental rate at which the revenue will be maximum is obtained as 237.5 from the calculation given below:
Check whether R’’(p) < 0 at p = 237.5:
If R’’(p) < 0 at p = 237.5 then p = 237.5 is the daily rental...
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