if the cost function for a firm is c(x)=8x-3 and the demand function is p=12-x, find the number of units of x that must be sold to maximize the profit function.
answer is x=2 but i cant figure out how to do it.
answer is x=2 but i cant figure out how to do it.
-
p=12-x
revenue=px=12x-x^2
marginal revenue=12-2x
cost=8x-3
marginal cost=8
max profit when marginal revenue = marginal cost
12-2x=8
=>
x=2
revenue=px=12x-x^2
marginal revenue=12-2x
cost=8x-3
marginal cost=8
max profit when marginal revenue = marginal cost
12-2x=8
=>
x=2