Question
Given demand curve P=400-.05Q, at what price is total revenue maximized?
There are a number of ways to do this problem. Let me use simple calculus.
Total Revenue is P*Q=400Q-.05Q^2. Take the first derivitive wrt Q. MR=400-.1Q To maximize, find Q when MR=zero. Q=4000 Plug this into the original demand equation..... (take it from here)
There are a number of ways to do this problem. Let me use simple calculus.
Total Revenue is P*Q=400Q-.05Q^2. Take the first derivitive wrt Q. MR=400-.1Q To maximize, find Q when MR=zero. Q=4000 Plug this into the original demand equation..... (take it from here)