Question

You operate a gaming website, www.mudbeast.net, where users must pay a small fee to log on. When you charged $3 the demand was 550 log-ons per month. When you lowered the price to $2.50, the demand increased to 825 log-ons per month.

(a) Construct a linear demand function for your website and hence obtain the monthly revenue R as a function of the log-on fee x.

R(x) =

_____

(b) Your Internet provider charges you a monthly fee of $50 to maintain your site. Express your monthly profit P as a function of the log-on fee x. HINT [See Example 4.]

P(x) =

Determine the log-on fee you should charge to obtain the largest possible monthly profit.
x = $   

What is the largest possible monthly profit?
$

Answer 1