SOLUTION: You sell widgets for $10 and have 500 customers. For every .25 cents you raise the price you will lose 2 customers. At what selling price would you have the most revenue and what w

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Question 964513: You sell widgets for $10 and have 500 customers. For every .25 cents you raise the price you will lose 2 customers. At what selling price would you have the most revenue and what would that revenue and selling price be ? Also how many customers would you have ?
Answer by stanbon(75887) About Me  (Show Source):
You can put this solution on YOUR website!
You sell widgets for $10 and have 500 customers. For every .25 cents you raise the price you will lose 2 customers. At what selling price would you have the most revenue and what would that revenue and selling price be ? Also how many customers would you have ?
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Revenue = (# of units sold)(price per unit)
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Equation:
R = (500-2x)(10+0.25x)
R = 5000+125x -20x -0.5x^2
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R = (-1/2)x^2 +105x + 5000
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Vertex:: (105,10512.50)
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At what selling price would you have the most revenue?
Ans: $10.00+0.25*105 = $36.25
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and what would that revenue be?
Ans: $10512.50
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Also how many customers would you have ?
Ans: 500 - 2*105 = 290
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Cheers,
Stan H.
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