Question
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A company manufactures and sells television sets per month. The monthly cost and price-demand
equations are and .
(A) Find the maximum revenue.
(B) Find the maximum profit, the production level that will realize the maximum profit, and the price the
company should charge for each television set.
(A) The maximum revenue is .
(Type an integer or a decimal.)
(B) The maximum profit is when sets are manufactured and sold for each.
(Type integers or decimals.)

Ask by Mann Goodwin. in the United States
Mar 24,2025

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Tutor-Verified Answer

Answer

(A) Maximum Revenue: $300,000
(B) Maximum Profit: $51,750 when 1,950 sets are manufactured and sold for $135 each.

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The Deep Dive

To solve the problem, let’s first look at the revenue and profit functions based on the provided equations.
Step 1: Revenue Function
The revenue is given by the product of the price and the number of television sets sold :
To find the maximum revenue, we need to find the derivative , set it to zero, and solve for :
Setting the derivative to zero:
Now, we calculate the maximum revenue by substituting back into the revenue function:
So, the maximum revenue is .
Step 2: Profit Function
The profit is given by:
We need to find the derivative :
Setting this derivative to zero:
Now calculate the maximum profit by finding :
Calculating :
Finally, we calculate the price at this production level:
So, the results are:
(A) The maximum revenue is .
(B) The maximum profit is when sets are manufactured and sold for each.

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