TTV Corporation's managers estimate that a 50% increase in price would cause an 80% reduction in the quantity of product sold. Total fixed costs for the product are $5,000 and total variable costs are $4,000, based on production of 400 units. The following values may be useful: $$\begin{array} { l }
\ln ( 0.2 ) = - 1.609 \quad \ln ( 1.5 ) = 0.405 \
\ln ( 0.5 ) = - 0.693 \quad \ln ( 4,000 ) = 8.294 \
\ln ( 0.8 ) = - 0.223 \quad \ln ( 5,000 ) = 8.517 \
\end{array}$$ TTV's profit maximizing price is:

Question

TTV Corporation's managers estimate that a 50% increase in price would cause an 80% reduction in the quantity of product sold. Total fixed costs for the product are $5,000 and total variable costs are $4,000, based on production of 400 units. The following values may be useful: $$\begin{array} { l } 
\ln ( 0.2 ) = - 1.609 \quad \ln ( 1.5 ) = 0.405 \
\ln ( 0.5 ) = - 0.693 \quad \ln ( 4,000 ) = 8.294 \
\ln ( 0.8 ) = - 0.223 \quad \ln ( 5,000 ) = 8.517 \
\end{array}$$ TTV's profit maximizing price is:

Quizplus · Accepted Answer

The Answer of TTV Corporation's managers estimate that a 50% increase in price would cause an 80% reduction in the quantity of product sold. Total fixed costs for the product are $5,000 and total variable costs are $4,000, based on production of 400 units. The following values may be useful: $$\begin{array} { l } 
\ln ( 0.2 ) = - 1.609 \quad \ln ( 1.5 ) = 0.405 \
\ln ( 0.5 ) = - 0.693 \quad \ln ( 4,000 ) = 8.294 \
\ln ( 0.8 ) = - 0.223 \quad \ln ( 5,000 ) = 8.517 \
\end{array}$$ TTV's profit maximizing price is:

TTV Corporation's Managers Estimate That a 50% Increase in Price