Given the demand function Q_X = 5,000 - 250P_X +120P_Y +.04I where
P_Y= $50.00 and I = $60,000, what is the total revenue equation?

Question

Given the demand function Q_X = 5,000 - 250P_X +120P_Y +.04I where P_Y= $50.00 and I = $60,000, what is the total revenue equation?

Quizplus · Accepted Answer

The total revenue equation is TR = PQ, where P is the price and Q is the quantity demanded. We can solve for P by rearranging the demand function: Q_X = 5,000 - 250P_X + 120P_Y + 0.04I 250P_X = 5,000 + 120P_Y + 0.04I - Q_X P_X = (5,000 + 120P_Y + 0.04I - Q_X)/250 Next, we substitute this expression for P into the total revenue equation: TR = (5,000 + 120P_Y + 0.04I - Q_X)/250 * Q_X Simplifying this expression, we get: TR = (53.6 * Q_X) - (0.004 * Q_X * ²) Therefore, the correct answer is D.

Given the Demand Function QX = 5,000 - 250PX +120PY

Given the Demand Function Q_X = 5,000 - 250P_X +120P_Y