Question

The monthly profit for a small company that makes long-sleeve T-shirts depends on the price per shirt. If the price is too high,
sales will drop. If the price is too low, the revenue brought in may not cover the cost to produce the shirts. After months of data
collection, the sales team determines that the monthly profit is approximated by f(P) = -50p + 1800p - 16,000, where p is the
price per shirt and f(p) is the monthly profit based on that price.
(a) Find the price that generates the maximum profit.
(b) Find the maximum profit.
(c) Find the price(s) that would enable the company to break even. If there is more than one price, use the "and" button.
Please solve all 3 parts.

Answer 1

Answer:

A. $18

B. $200

C. $p\in (16,20)$

Step-by-step explanation:

Function:

$f(p) = -50p^2 + 1,800p - 16,000$

Parts A and B:

The price that generates the maximum profit is ate vertex of parabola. Find the coordinates of the vertex:

$p_v=\dfrac{-b}{2a}=\dfrac{-1,800}{2\cdot (-50)}=\dfrac{1,800}{100}=18\\ \\f(p_v)=-50\cdot 18^2+1,800\cdot 18-16,000=200$

The price that generates the maximum profit is $18

The maximum profit is $200

Part C:

The company breaks even when the profit is positive. From the graph of the function you can see that the graph of the function is over p-axis for all $p\in (16,20)$, so the positive profit is for $p\in (16,20)$

In p=16 and p=20, the profit is 0 and when p<16 and p>20, there will be a loss.