Question

A model for a company's revenue from selling a software package is R(p) = -2.5p^2 + 750p where p is the price in dollars of the software. What price will maximize revenue? Find the maximum revenue.

Answer 1

• $150 and $56250

Explanation:

This is a quadratic function with negative leading coefficient.

The graph opens down and its maximum is at vertex.

The x-coordinate of the vertex is given by x = -b/2a:

• x = -750/(-2.5*2) = 150

The $150 price will maximize revenue:

• R(150) = -2.5*150² + 750*150 = 56250