A deli sells 640 sandwiches per day at a price of $8 A market survey shows that

Question

A deli sells 640 sandwiches per day at a price of $8 A market survey shows that every$0.10 reduction in the price ,20 more sandwiches will be sold. How much should the deli charge in order to maximize revenue? The deli should charge $ for a sandwich revenue. (Round to the nearest cent as needed.) A different market survey shows that for every$0.20 reduction in the original $8 price,5 more sandwiches will be sold Now how much should the deli charge in order to maximize revenue? Now the deli should charge $ for a sandwich to maximize revenue. (Round the nearest cent as needed.)

Explanation / Answer

You wish to find a revenue maximum, so what you need is a differentiable revenue equation.......

Here it is, step by step

R = (640 + 20n)(8 - 0.10n) = 5120 + 160n - 64n - 2n^2 = 5120 + 96n - 2n^2

dR/dn = 96 - 4n

96 -4n = 0

n = 24

R(max) is when price = $8.00 - 24 x $0.10 = $ 5.60

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.