Marginal Revenue: Pricing Tuna Assume that the demand equation for tuna in a small coastal town is given by
a. Calculate the price that the town’s fishery should charge for tuna to produce a demand of 400 pounds of tuna per month.
b. Calculate the monthly revenue R as a function of the number of pounds of tuna q.
c. Calculate the revenue and marginal revenue (derivative of the revenue with respect to q) at a demand level of 400 pounds per month, and interpret the results.
d. If the town fishery’s monthly tuna catch amounted to 400 pounds of tuna and the price is at the level in part (a), would you recommend that the fishery raise or lower the price of tuna to increase its revenue?
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Applied Calculus
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