Question

A car rental agency has 42 cars (each an identical model). the owner of the agency finds that at a price of $32 per day, all the cars can be rented; however, for each $1 increase in rental cost, one of the cars is not rented. what should the agency charge to maximize income?

Answer 1

The car rental agency should charge $32 per day to maximize income.

Step-by-step explanation:

To maximize income, the car rental agency should charge a rental cost that allows all 42 cars to be rented. According to the information given, at a price of $32 per day, all the cars can be rented. However, for each $1 increase in rental cost, one car is not rented. This means that if the agency charges $33 per day, one car will not be rented, resulting in a loss of income. Therefore, the agency should continue charging $32 per day to maximize its income.

Answer 2

increase to 38 and have the unused ones in for maintenance