SOLUTION: Suppose that the price per unit in dollars of a cell phone production is modeled by p = $85 − 0.0125x,
where x is in thousands of phones produced, and the revenue represente
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-> SOLUTION: Suppose that the price per unit in dollars of a cell phone production is modeled by p = $85 − 0.0125x,
where x is in thousands of phones produced, and the revenue represente
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Question 1127680: Suppose that the price per unit in dollars of a cell phone production is modeled by p = $85 − 0.0125x,
where x is in thousands of phones produced, and the revenue represented by thousands of dollars is
R = x · p. Find the production level that will maximize revenue.
From the condition, the revenue is
R(x) = x*p = x*(85-0.o0125x) = -0.00125 + 85x thousands of dollars.
It is a quadratic function, and the problem asks you to find its maximum.
For the general form quadratic function y(x) = ax^2 + bx + c with the negative leading coefficient "a"
the maximum is achieved at x = .
In our case, a = 0.0125, b= 85, so the maximum is achieved at
x = = 6800.
It is "the production level that will maximize revenue". ANSWER
