You operate a gaming Web site where users pay a small fee to log on. When you charge $2 the demand was 280 log-ons per month. When you lowered the price to $1.50, the demand increased to 593 log-ons per month Construct a linear demand function for your Web site and hence obtain the monthly revenue R as a function of the log-on fee p. Your internet provider charges you a monthly fee of 30 to maintain your site. There is no cost per log-on. Express your monthly profit P as a function of the log-on fee p. Now determine the log-on fee you should charge to obtain the largest possible monthly profit: dollars. What is the largest possible monthly profit? dollars per month

Question
You operate a gaming Web site where users pay a small fee to log on. When you charge $2 the demand was 280 log-ons per month. When
you lowered the price to $1.50, the demand increased to 593 log-ons per month
Construct a linear demand function for your Web site and hence obtain the monthly revenue R as a function of the log-on fee p.
Your internet provider charges you a monthly fee of 30 to maintain your site. There is no cost per log-on. Express your monthly profit P as a
function of the log-on fee p.
Now determine the log-on fee you should charge to obtain the largest possible monthly profit:
dollars.
What is the largest possible monthly profit?
dollars per month

Image Transcription

You operate a gaming Web site where users pay a small fee to log on. When you charge $2 the demand was 280 log-ons per month. When you lowered the price to $1.50, the demand increased to 593 log-ons per month Construct a linear demand function for your Web site and hence obtain the monthly revenue R as a function of the log-on fee p. Your internet provider charges you a monthly fee of 30 to maintain your site. There is no cost per log-on. Express your monthly profit P as a function of the log-on fee p. Now determine the log-on fee you should charge to obtain the largest possible monthly profit: dollars. What is the largest possible monthly profit? dollars per month

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