Marketing department of a manufacturing company estimates that the demand q (in thousands of units per year) for an electric typewriter is related to their price by the demand equation q=200-0.9p. Because of efficiency and technological advances, the prices are falling at a rate of £30 per year. The current price of a typewriter is £650. At what rate are revenues changing?
2007-03-07 10:25:14 · 1 answers · asked by Anonymous in Business & Finance ➔ Other - Business & Finance
Revenue is price p * units sold.
Number sold = number demanded = 1000 * q.
This gives you Revenue = p * 1000 * q.
Since q = 200 - 0.9 p (which, by the way gives a negative number), you can enter the 2 prices, p = 650 (current) and p = 620 (i.e. at end of year when it's reduced by £30) in order to discover the change in Revenue.
2007-03-08 06:37:04 · answer #1 · answered by Steve B 7 · 0⤊ 0⤋