Two women have decided to start a cottage industry that will be run out of their homes. They are going to make two types of specialty shirts, rhinestone and embroidery. The total gross profit is given by P(x, y) = 16x + 20y – x² – y² where x is the number of rhinestone shirts made and y is the number of embroidery shirts made per month. Together, they are able to make at most a total of six shirts per month. What is the number of each type of shirt that they should try to make and sell in order to maximize their profit each month? Solve using Lagrange multipliers approach.

Two women have decided to start a cottage industry that will be run out of their homes. They are going to make two types of specialty shirts, rhinestone and embroidery. The total gross profit is given by P(x, y) = 16x + 20y – x² – y² where x is the number of rhinestone shirts made and y is the number of embroidery shirts made per month. Together, they are able to make at most a total of six shirts per month. What is the number of each type of shirt that they should try to make and sell in order to maximize their profit each month? Solve using Lagrange multipliers approach.

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter12: Price And Output Determination: Oligopoly

Section: Chapter Questions

Problem 1E

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