A company produces and sells a consumer product and is able, Ask an Expert

Economics

A company produces and sells a consumer product and is able to control the demand for the product by varying the selling price. The approximate relationship between price and demand is

p=$35 + 2800/D - 4900/D^2, for D>1.

Where p is the price per unit in dollars and D is the demand per month. The company is seeking to maximize its profit. The fixed cost is $1,100 per month ad the variable cost (cv) is $45 per unit.

What is the number of units that should be produced and sold each month to maximize its profit?

Show that your answer to Part (a) maximizes profit.

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Business Economics, Economics

Category:- Business Economics
Reference No.:- M91420975

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