Question

Walmart has purchased 1000 swimsuits before the start of the

summer season at a cost of $10 each (for a total cost of $10,000).
The season lasts four months, and Walmart has forecast demand in
each of

Answer 1

the four months as follows:

Month 1: 500 swimsuits

Month 2: 700 swimsuits

Month 3: 900 swimsuits

Month 4: 600 swimsuits

Walmart wants to determine the optimal selling price for the swimsuits to maximize their profit. They have estimated the following demand function for swimsuits:

Q = 1200 - 100P

where Q represents the quantity demanded and P represents the selling price per swimsuit.

To maximize profit, Walmart needs to find the price that maximizes their revenue while considering the cost of purchasing the swimsuits. Let's calculate the optimal selling price and the resulting profit for each month.