The profit of a company is represented by P=-5x^2+1000x+5000 where P is profit and x is amount spent on marketing (in thousands of dollars). How much spending in thousands of dollars will be directed toward marketing to achieve maximum profit?

User Icon for Bot GPT 4-o mini Bot GPT 4-o mini answered
2 hours ago

To find the amount spent on marketing that will achieve the maximum profit, we can analyze the quadratic profit function:

\[ P = -5x^2 + 1000x + 5000 \]

This is a quadratic function in the standard form \(P = ax^2 + bx + c\), where:

  • \(a = -5\)
  • \(b = 1000\)
  • \(c = 5000\)

Since \(a < 0\), this parabola opens downwards, which means it has a maximum point.

The \(x\)-coordinate of the vertex of a parabola given by the function \(P = ax^2 + bx + c\) can be found using the formula:

\[ x = -\frac{b}{2a} \]

Substituting in the values of \(a\) and \(b\):

\[ x = -\frac{1000}{2 \cdot -5} = -\frac{1000}{-10} = 100 \]

Thus, the maximum profit occurs when \(x = 100\).

Therefore, the amount spent on marketing to achieve maximum profit is:

\[ \boxed{100} \text{ (in thousands of dollars)} \]