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View Full Version : A company manufacturing memory chips has established the following price-demand


over9001
Aug 4, 2010, 12:07 PM
hello all, I am new to the forum, can someone help me with this question please?

A company manufacturing memory chips has established the following price-demand
and revenue functions:
p(x) = 80 - 4x
R(x) = xp(x) = x(80 - 4x)
where p(x) is the wholesale price in euros at which x million chips can be sold and
R(x) is in millions of euros. Find the output that will yield the maximum revenue.
What is the wholesale price per chip that produces the maximum revenue?

Unknown008
Aug 5, 2010, 02:09 AM
To find the maximum revenue, you need to find the derivative of your revenue function. Once you get your derivative, set it to zero and solve for x, the number of chips in millions that are to be manufactured to get maximum revenue.

Once you get the value of x, plug that into your wholesale price function to find the wholesale price at that maximum revenue.