A- A company is planning to introduce two new products: A and B. It is estimated that the price of product A and B are 300 and 500 $, respectively. It also estimated that the cost of product A is 180$ per unit, and the cost of product b IS 200$ per unit, plus additional cost of 500000 $. In competitive market the number of sales will affect the sales price. It is estimated that for each product, the sales price drops by one cent for each additional unit a sold. Furthermore, sales of the product will affect sales of product B and vice versa. It is estimated that the price for the product A will reduced by an additional 0.1 cents for each product B sold and the price for product B will decrease for by 0.3 cent for each of product A sold. Formulate the given problem to maximize the profit of the company?

A- A company is planning to introduce two new products: A and B. It is estimated that the price of product A and B are 300 and 500 $, respectively. It also estimated that the cost of product A is 180$ per unit, and the cost of product b IS 200$ per unit, plus additional cost of 500000 $. In competitive market the number of sales will affect the sales price. It is estimated that for each product, the sales price drops by one cent for each additional unit a sold. Furthermore, sales of the product will affect sales of product B and vice versa. It is estimated that the price for the product A will reduced by an additional 0.1 cents for each product B sold and the price for product B will decrease for by 0.3 cent for each of product A sold. Formulate the given problem to maximize the profit of the company?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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