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7.5D Written Homework

This document contains 3 word problems about profit and revenue maximization. Problem 1 asks about Granny's Donuts daily costs and demand functions to find the number of donuts, maximum profit, and optimal price. Problem 2 deals with BeSharp Precision's camera production costs. Problem 3 is about a TV's demand equation and asks questions to determine the revenue-maximizing quantity and price.

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46 views2 pages

7.5D Written Homework

This document contains 3 word problems about profit and revenue maximization. Problem 1 asks about Granny's Donuts daily costs and demand functions to find the number of donuts, maximum profit, and optimal price. Problem 2 deals with BeSharp Precision's camera production costs. Problem 3 is about a TV's demand equation and asks questions to determine the revenue-maximizing quantity and price.

Uploaded by

Johnca
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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7.

5D Written Homework Name: ________________________

1. Granny’s Donuts finds that their daily costs can be modeled by the function 𝐶(𝑥) = 150 + .2𝑥, where 𝑥 is the
number of donuts produced each day. In addition, through market research they found that their demand (price)
function can be modeled by 𝑝(𝑥) = −0.01𝑥 + 3.5

a) What number of donuts maximizes profit?

b) What is the maximum daily profit?

c) What price per donut should Granny’s charge in order to maximize profit?
2. The total monthly cost incurred by BeSharp Precision for manufacturing 𝑥 units of their new model camera is
given by the function 𝐶(𝑥) = 0.0025𝑥 ! − 80𝑥 + 1,000,000.

a) Find the level of production which results in the lowest cost.

b) What is the lowest cost?

3. The sales from a small flat -screen TV obeys the demand equation: 𝑝 = −0.15𝑥 + 300 where 𝑝 is the price and
𝑥 is the quantity.

a) How much should be charged for the television set if there are 60 sets in stock?

b) What is the revenue from the sale of 60 TV’s?

c) What quantity, 𝑥, will maximize revenue?

d) What is the maximum revenue?

e) What price should be charged in order to maximize revenue?

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