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Mathematical Applications for the ...

11th Edition
Ronald J. Harshbarger + 1 other
ISBN: 9781305108042

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BuyFindarrow_forward

Mathematical Applications for the ...

11th Edition
Ronald J. Harshbarger + 1 other
ISBN: 9781305108042
Textbook Problem

Coastal Soda Sales has been granted exclusive market rights to the upcoming Beaufort Seafood Festival. This means that during the festival, Coastal will have a monopoly, and it is anxious to take advantage of this position in its pricing strategy. The daily demand function is

p   =   2   0.0004 x and the daily total cost function is

C ( x )   =   800   +   0.2 x   +   0.0001 x 2 where x is the number of units.

(a) Determine Coastal's total revenue and profit functions.

(b) What profit-maximizing price per soda should Coastal charge, how many sodas per day would it expect to sell at this price, and what would be the daily profits?

(c) If the festival organizers wanted to set an economically efficient price of $1.25 per soda, how would this change the results from part (b)? Would Coastal be willing to provide sodas for the festival at this regulated price? Why or why not?

(a)

To determine

To calculate: The Coastal’s total revenue and profit functions if the Coastal soda sales has granted exclusive market rights for the upcoming Beaufort Seafood Festival.

Explanation

Given information:

The provided information is:

The Coastal soda sales granted exclusive market rights for the upcoming Beaufort Seafood Festival, that means during festival, the Coastal will have monopoly, and which is anxious to take advantage of this position in its pricing strategy.

Formula used:

The daily demand function is:

p=20.0004x

The daily cost function is:

C(x)=800+0.02x+0.0001x2

Calculation:

Consider the provided information.

The daily demand function is:

p=20.0004x

The daily cost function is:

C(x)=800+0.02x+0.0001x2

Find out the Coastal’s total revenue as:

R(x)=px=(20.0004x)x=2x0.0004x2

Hence, the Coastal’s total revenue is 2x0

(b)

To determine

To calculate: The profit maximizing price per soda should Coastal charge, the number of sodas per day would it expect to sell at this price, and the daily profits if the Coastal soda sales has granted exclusive market rights for the upcoming Beaufort Seafood Festival.

(c)

To determine

To calculate: The Coastal want to provide sodas for the festival at the regulated price if the festival organizers wanted to set an economically efficient price of $1.25 per soda, how would this change the result from part(b)

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Sect-10.1 P-7ESect-10.1 P-8ESect-10.1 P-9ESect-10.1 P-10ESect-10.1 P-11ESect-10.1 P-12ESect-10.1 P-13ESect-10.1 P-14ESect-10.1 P-15ESect-10.1 P-16ESect-10.1 P-17ESect-10.1 P-18ESect-10.1 P-19ESect-10.1 P-20ESect-10.1 P-21ESect-10.1 P-22ESect-10.1 P-23ESect-10.1 P-24ESect-10.1 P-25ESect-10.1 P-26ESect-10.1 P-27ESect-10.1 P-28ESect-10.1 P-29ESect-10.1 P-30ESect-10.1 P-31ESect-10.1 P-32ESect-10.1 P-33ESect-10.1 P-34ESect-10.1 P-35ESect-10.1 P-36ESect-10.1 P-37ESect-10.1 P-38ESect-10.1 P-39ESect-10.1 P-40ESect-10.1 P-41ESect-10.1 P-42ESect-10.1 P-43ESect-10.1 P-44ESect-10.1 P-45ESect-10.1 P-46ESect-10.1 P-47ESect-10.1 P-48ESect-10.1 P-49ESect-10.1 P-50ESect-10.1 P-51ESect-10.1 P-52ESect-10.1 P-53ESect-10.1 P-54ESect-10.1 P-55ESect-10.1 P-56ESect-10.1 P-57ESect-10.1 P-58ESect-10.1 P-59ESect-10.1 P-60ESect-10.1 P-61ESect-10.1 P-62ESect-10.1 P-63ESect-10.1 P-64ESect-10.1 P-65ESect-10.2 P-1CPSect-10.2 P-2CPSect-10.2 P-3CPSect-10.2 P-4CPSect-10.2 P-1ESect-10.2 P-2ESect-10.2 P-3ESect-10.2 P-4ESect-10.2 P-5ESect-10.2 P-6ESect-10.2 P-7ESect-10.2 P-8ESect-10.2 P-9ESect-10.2 P-10ESect-10.2 P-11ESect-10.2 P-12ESect-10.2 P-13ESect-10.2 P-14ESect-10.2 P-15ESect-10.2 P-16ESect-10.2 P-17ESect-10.2 P-18ESect-10.2 P-19ESect-10.2 P-20ESect-10.2 P-21ESect-10.2 P-22ESect-10.2 P-23ESect-10.2 P-24ESect-10.2 P-25ESect-10.2 P-26ESect-10.2 P-27ESect-10.2 P-28ESect-10.2 P-29ESect-10.2 P-30ESect-10.2 P-31ESect-10.2 P-32ESect-10.2 P-33ESect-10.2 P-34ESect-10.2 P-35ESect-10.2 P-36ESect-10.2 P-37ESect-10.2 P-38ESect-10.2 P-39ESect-10.3 P-1CPSect-10.3 P-2CPSect-10.3 P-3CPSect-10.3 P-4CPSect-10.3 P-1ESect-10.3 P-2ESect-10.3 P-3ESect-10.3 P-5ESect-10.3 P-6ESect-10.3 P-7ESect-10.3 P-8ESect-10.3 P-9ESect-10.3 P-10ESect-10.3 P-11ESect-10.3 P-12ESect-10.3 P-13ESect-10.3 P-14ESect-10.3 P-15ESect-10.3 P-16ESect-10.3 P-17ESect-10.3 P-18ESect-10.3 P-19ESect-10.3 P-20ESect-10.3 P-21ESect-10.3 P-22ESect-10.3 P-23ESect-10.3 P-24ESect-10.3 P-25ESect-10.3 P-26ESect-10.3 P-27ESect-10.3 P-28ESect-10.3 P-29ESect-10.3 P-30ESect-10.3 P-33ESect-10.3 P-34ESect-10.3 P-35ESect-10.3 P-36ESect-10.3 P-37ESect-10.3 P-38ESect-10.3 P-39ESect-10.3 P-40ESect-10.3 P-41ESect-10.3 P-42ESect-10.3 P-43ESect-10.3 P-47ESect-10.3 P-48ESect-10.3 P-49ESect-10.4 P-1CPSect-10.4 P-2CPSect-10.4 P-3CPSect-10.4 P-1ESect-10.4 P-2ESect-10.4 P-3ESect-10.4 P-4ESect-10.4 P-5ESect-10.4 P-6ESect-10.4 P-7ESect-10.4 P-8ESect-10.4 P-9ESect-10.4 P-10ESect-10.4 P-11ESect-10.4 P-12ESect-10.4 P-13ESect-10.4 P-14ESect-10.4 P-15ESect-10.4 P-16ESect-10.4 P-17ESect-10.4 P-18ESect-10.4 P-19ESect-10.4 P-20ESect-10.4 P-21ESect-10.4 P-22ESect-10.4 P-23ESect-10.4 P-24ESect-10.4 P-25ESect-10.4 P-26ESect-10.4 P-27ESect-10.4 P-28ESect-10.4 P-29ESect-10.4 P-30ESect-10.4 P-31ESect-10.4 P-32ESect-10.4 P-33ESect-10.5 P-1CPSect-10.5 P-2CPSect-10.5 P-1ESect-10.5 P-2ESect-10.5 P-3ESect-10.5 P-4ESect-10.5 P-5ESect-10.5 P-6ESect-10.5 P-7ESect-10.5 P-8ESect-10.5 P-9ESect-10.5 P-10ESect-10.5 P-11ESect-10.5 P-12ESect-10.5 P-13ESect-10.5 P-14ESect-10.5 P-15ESect-10.5 P-16ESect-10.5 P-17ESect-10.5 P-18ESect-10.5 P-19ESect-10.5 P-20ESect-10.5 P-21ESect-10.5 P-22ESect-10.5 P-23ESect-10.5 P-24ESect-10.5 P-25ESect-10.5 P-26ESect-10.5 P-27ESect-10.5 P-28ESect-10.5 P-29ESect-10.5 P-30ESect-10.5 P-31ESect-10.5 P-32ESect-10.5 P-33ESect-10.5 P-34ESect-10.5 P-35ESect-10.5 P-36ESect-10.5 P-37ESect-10.5 P-38ESect-10.5 P-39ESect-10.5 P-40ESect-10.5 P-41ESect-10.5 P-42ESect-10.5 P-43ECh-10 P-1RECh-10 P-2RECh-10 P-3RECh-10 P-4RECh-10 P-5RECh-10 P-6RECh-10 P-7RECh-10 P-8RECh-10 P-9RECh-10 P-10RECh-10 P-11RECh-10 P-12RECh-10 P-13RECh-10 P-14RECh-10 P-15RECh-10 P-16RECh-10 P-17RECh-10 P-18RECh-10 P-19RECh-10 P-20RECh-10 P-21RECh-10 P-22RECh-10 P-23RECh-10 P-24RECh-10 P-25RECh-10 P-26RECh-10 P-27RECh-10 P-28RECh-10 P-29RECh-10 P-30RECh-10 P-31RECh-10 P-32RECh-10 P-33RECh-10 P-34RECh-10 P-35RECh-10 P-36RECh-10 P-37RECh-10 P-38RECh-10 P-39RECh-10 P-40RECh-10 P-41RECh-10 P-42RECh-10 P-43RECh-10 P-44RECh-10 P-45RECh-10 P-46RECh-10 P-47RECh-10 P-48RECh-10 P-49RECh-10 P-50RECh-10 P-51RECh-10 P-52RECh-10 P-53RECh-10 P-54RECh-10 P-55RECh-10 P-1TCh-10 P-2TCh-10 P-3TCh-10 P-4TCh-10 P-5TCh-10 P-6TCh-10 P-7TCh-10 P-8TCh-10 P-9TCh-10 P-10TCh-10 P-11TCh-10 P-12TCh-10 P-13TCh-10 P-14TCh-10 P-15TCh-10 P-16TCh-10 P-17T

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