Question

A certain TV station has 1000 customers paying $20 each month. If each $1 reduction in price attracts 100 new customers, find the price that yields maximum revenue. Find the maximum revenue ?

Answer 1

$15 gives $22,500

Explanation:

`1000 xx $20 = $20,000`
`1100 xx $19 = $20,900`
`1200 xx $18 = $21,600`
`1300 xx $17 = $22,100`
`1400 xx $16 = $22,400`
`1500 xx $15 = $22,500`
`1600 xx $14 = $22,400`