When Farmer Hoglund applies N pounds of fertilizer per acre, the marginal product of fertilizer is 1 -N/200 bushels of corn.If the price of corn is $4 per bushel and the price of fertilizer is $1.20 per pound, then how many pounds of fertilizer per acre should Farmer Hoglund use in order to maximize his profits?
A)140
B)280
C)74
D)288
E)200

Question

Quizplus · Accepted Answer

To maximize profits, set the marginal product of fertilizer equal to the ratio of the price of fertilizer to the price of corn. So, 1 - N/200 = 1.20/4. Solving for N gives N = 140.

When Farmer Hoglund Applies N Pounds of Fertilizer Per Acre