Suppose total benefits and total costs are given by B(Y)= 150Y − 10Y² and C(Y)= 5Y².What level of Y will yield the maximum net benefits? A) 7 B) 10/9 C) 5 D) 150/20

Question

Quizplus · Accepted Answer

To find the level of Y that yields maximum net benefits, calculate the derivative of the net benefit function N(Y) = B(Y) - C(Y) and set it to zero. N(Y) = (150Y - 10Y^2) - (5Y^2) = 150Y - 15Y^2. The derivative is dN/dY = 150 - 30Y. Setting this to zero gives 150 - 30Y = 0, solving for Y gives Y = 5.

Suppose Total Benefits and Total Costs Are Given by B(Y)=