Television Advertising
As sales manager for Monevideo Production, Inc, You are planning to review the price you charge clients fot TV advertisement development.You currently change each client an hourly development fee of $2500. With this pricing strcuture, the demand, measured by the number of contracts Montevideo sings per month, is 15 contracts. This is down 5 contracts from the figure last year, when your company charged only $2000.
a. Construct a linear demand equation giving the number of contracts q asa function of the hourly fee p Montevideo charges for development.
b. On average, Montevideo bills for 50 hours of production time on each contract. Give a formula for the total revenue obtained by charging $p pre hour.
c. the costs to Montevideo Productions are estimated as follows:
Fixed costs: $120,000 per month
Variable costs: $80,000 per contract
Express Montevidso Productions'monthly cost (i) as a functionof the number q of contractss and (ii) as a function of the hourly production charge p.
d. Express Monteviedo Productions' monthly profit as a function of the hourly development fee p and find the price it should charge to miximize the profit.
2007-01-18
19:43:19
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1 answers
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Anonymous