The owner of a novelty store can obtain joy buzzers from the manufacturer for 70 cents apiece. He estimates he can sell 40 buzzers when he charges $1.40 apiece for them and that he will be able to sell 15 more buzzers for every 10 cent decrease in price. What price should he charge in order to maximize profit?
A) $1.08
B) $1.18
C) $0.98
D) $1.28

Question

Quizplus · Accepted Answer

The profit can be maximized by setting up an equation for profit (P) based on the price (x) and solving for x. The equation for profit is P = (x - 0.70)(40 + 15(n)), where x is the selling price and n is the number of 10 cent decreases from the initial $1.40 price. The optimal price, after solving, is $1.18, which maximizes profit.

The Owner of a Novelty Store Can Obtain Joy Buzzers