Math Problem Statement
If the revenue function for a particular commodity is R(p) = −57p2 + 66p, what is the (linear) demand function q(p)? q(p) =
Give a reason for your answer.
R = pq
R = q p
R = q − p
R = p q
R = p + q
Solution
The revenue function for a commodity is given by:
We know that revenue is the product of price and quantity demanded :
Thus, the demand function can be expressed as:
Substitute into the equation:
Simplifying the right-hand side:
Thus, the demand function is:
Reason:
Revenue is calculated as , meaning the demand function is obtained by dividing the revenue function by . This results in a linear demand function in terms of .
Would you like further details or have any questions?
Here are 5 related questions to expand your understanding:
- How is marginal revenue derived from the revenue function?
- What happens to demand as the price increases, according to this demand function?
- How would you find the price elasticity of demand from this function?
- What is the significance of the slope in the demand function ?
- How would the revenue function change if demand were elastic?
Tip: The slope of the demand function represents the rate of change in quantity demanded with respect to price changes.
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Math Problem Analysis
Mathematical Concepts
Algebra
Revenue Function
Demand Function
Linear Functions
Formulas
R(p) = p * q(p)
q(p) = R(p) / p
Theorems
Linear Demand Function Theorem
Revenue Function Definition
Suitable Grade Level
College/Advanced High School
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