As Sales Manager for Montevideo Productions, Inc., you are planning to review the prices you charge clients for television advertisement development. You currently charge each client an hourly...

(a) Construct a linear demand equation giving the number of contracts
q
as a function of the hourly fee
p
Montevideo charges for development.

q(p) =

(b) On average, Montevideo bills for 50 hours of production time on each contract. Give a formula for the total revenue obtained by charging $p
per hour.

R(p) =

(c) The costs to Montevideo Productions are estimated as follows:

Express Montevideo Productions' monthly cost as a function of the number
q
of contracts.

C(q) =

Express Montevideo Productions' monthly cost as a function of the hourly production charge
p.

C(p) =

(d) Express Montevideo Productions' monthly profit as a function of the hourly development fee
p.

P(p) =

Find the price it should charge to maximize the profit.


p
= $ per hour