DM Publishing Company

DM Publishing Company is considering offering a new edition of its Quantitative Methods textbook. According to their market research, a good estimate of demand for their textbook can be determined from the following equation: demand = 16,500 - 95p, where p is the retail price of the textbook. DM management believes this formula holds for prices from $90 to $140. DM has also estimated their unit production costs as $23 for raw materials, $15 for labor, and $18 for marketing and shipping. If DM decides to manufacture the textbook, they can expect production setup costs (fixed costs) of $180,000, regardless of the number of textbooks they sell.

In the DM Publishing Company problem, how much profit can the company expect at a price of $130?

In the DM Publishing Company problem, what is the breakeven point (number of units) at a price of $120?

In the DM Publishing Company problem, how much demand can the company expect at a price of $130?

In the DM Publishing Company problem, at what exact price does the company maximize their profit?