Assignment:
SALE REVENUE PROBLEMS
Sale managers normally want to increase revenue R by selling more. For example, a manager may know by experience that revenue R will increase or decrease according to the following mathematical linear model for a a sales price P and quantity sold Q of a certain commodity:
P=Po +-px [This represents a linear equation with positive or negative slope]
Q=Qo+-qx [This represents a linear equation with positive or negative slope]
In other words, "q" more(+) or less(-) units per month can be sold if the price is decreased(-)/increased(+) by $"p" in multiples of 1, 2, ..or "x". The slopes "p" and "q" are different for different commodoties.
R=P*Q
The owner of an apartment complex knows he can rent all 50 apartments when the monthly rent is $400. He thinks that for each $25 increase in the rent, he will loose two tenants. He would be happy with revenue of $20,400 per month.
• Write an expression for the price P
• Write an expression for the number of apartments Q that can be rented a price P
• Write an equation that relates the revenue to the price and number of apartments.
Provide complete and step by step solution for the question and show calculations and use formulas.