Pearl Ltd. intends to manufacture and market mechanical weighing scales. Their research department has derived the price-demand equation and the cost function, respectively as x = 6200 - 50p and C(x) = 7400 + 70x where x is the number of scales that can be sold at Sp per unit and C(x) represents the total cost of producing x scales. (a) Express the price p as a function of the demand x. Find the domain of this function. (b) Find the exact cost of producing the 45th scale.

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
14th Edition
ISBN:9781305506381
Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Chapter9: Applications Of Cost Theory
Section: Chapter Questions
Problem 3E
icon
Related questions
Question

MARGINAL ANALYSIS

Pearl Ltd. intends to manufacture and market mechanical weighing scales. Their research
department has derived the price-demand equation and the cost function, respectively as
x = 6200 - 50p and C(x) = 7400 + 70x
where x is the number of scales that can be sold at Sp per unit and C(x) represents the total
cost of producing x scales.
(a) Express the price p as a function of the demand x. Find the domain of this function.
(b) Find the exact cost of producing the 45th scale.
(c) Find the marginal cost function and use it to approximate the cost of producing the 45th
scale.
(d) Determine the Revenue, R(x) and Profit, P(x) functions.
(e) Find the marginal revenue at production levels of 2800 and 3500 scales. Give an
interpretation for both results.
Transcribed Image Text:Pearl Ltd. intends to manufacture and market mechanical weighing scales. Their research department has derived the price-demand equation and the cost function, respectively as x = 6200 - 50p and C(x) = 7400 + 70x where x is the number of scales that can be sold at Sp per unit and C(x) represents the total cost of producing x scales. (a) Express the price p as a function of the demand x. Find the domain of this function. (b) Find the exact cost of producing the 45th scale. (c) Find the marginal cost function and use it to approximate the cost of producing the 45th scale. (d) Determine the Revenue, R(x) and Profit, P(x) functions. (e) Find the marginal revenue at production levels of 2800 and 3500 scales. Give an interpretation for both results.
Expert Solution
steps

Step by step

Solved in 4 steps

Blurred answer
Knowledge Booster
Marginal Benefit and Marginal Cost
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.
Recommended textbooks for you
Managerial Economics: Applications, Strategies an…
Managerial Economics: Applications, Strategies an…
Economics
ISBN:
9781305506381
Author:
James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:
Cengage Learning
Microeconomic Theory
Microeconomic Theory
Economics
ISBN:
9781337517942
Author:
NICHOLSON
Publisher:
Cengage
Managerial Economics: A Problem Solving Approach
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
Survey Of Economics
Survey Of Economics
Economics
ISBN:
9781337111522
Author:
Tucker, Irvin B.
Publisher:
Cengage,
Micro Economics For Today
Micro Economics For Today
Economics
ISBN:
9781337613064
Author:
Tucker, Irvin B.
Publisher:
Cengage,
Economics For Today
Economics For Today
Economics
ISBN:
9781337613040
Author:
Tucker
Publisher:
Cengage Learning