SOLUTION: Steve owns a hotdog stand. He has found that sales of hot dogs average 42,000 hot dogs a year when the hot dogs sell for $2.50 each. For each 50 cent increase in the price, the num

Question 440190: Steve owns a hotdog stand. He has found that sales of hot dogs average 42,000 hot dogs a year when the hot dogs sell for $2.50 each. For each 50 cent increase in the price, the number of hotdogs sold drop by 5000. What price per hot dog should Steve charge to realize the maximum revenue?
A. $1.70
B. $4.20
C. $3.35
D. $3.60

Answer by josmiceli(19441) (Show Source): You can put this solution on YOUR website!
Let = the number of cent increases in price
Let = revenue
given:
(in cents)
--------------------------------

This is a parabola with a maximum, since the
coefficient of is minus.
The max is at where

is the number of cent increases in price,
cents is the increase over $2.50 that
Steve should allow

He should charge $3.35 per hot dog
------------------------------
You can check this by putting , and
into

and seeing ir peaks at
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