Think of yourself as a Big Mall entrepreneur who sells 1,000 cupcakes a day for $3 each. When you raised the price to $4

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Think Of Yourself As A Big Mall Entrepreneur Who Sells 1 000 Cupcakes A Day For 3 Each When You Raised The Price To 4 1 (30.92 KiB) Viewed 38 times

Think of yourself as a Big Mall entrepreneur who sells 1,000 cupcakes a day for $3 each. When you raised the price to $4.00 each, the sale plummeted to 800 cupcakes a day. Now, let's say there's a linear relationship between the price and the number of cupcakes sold. Furthermore, assume that there is a fixed cost (overhead) of $500 per day and the cost of each cupcake is $1.50. What would be the price of a cake for maximum profit? (First determine the linear relationship of the number of units sold per day, n, to the unit price, x,n(x)=a+bx, then maximize the profit function with respect to the unit price, x. Note: Profit = total revenue − total cost -overhead.)