Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Hello, I am confused with this problem . The monthly demand equation for an electric utility company is estimated to be p = 53 (10

Hello, I am confused with this problem .

image text in transcribed
The monthly demand equation for an electric utility company is estimated to be p = 53 (10 _ 5) x. where p is measured in dollars and x is measured in thousands of killowatthours, The utility has xed costs of $1,000,000 per month and variable costs of $21 per 1000 kilowatthours of electricity generated, so the cost function is 6 C(x}:1 - 10 + 21x. (a) Find the value of x and the corresponding price for 1000 kilowattihours that maximize the utility's prot. (b) Suppose that the rising fuel costs increase the utility's variable costs from $21 to $35, so its new cost function is C1(x) = 1 - 106 + 35x. Should the utitity pass all this increase of $14 per thousand kilowattihours on to the consumers

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Theory Of Distributions

Authors: Svetlin G Georgiev

1st Edition

3319195271, 9783319195278

More Books

Students also viewed these Mathematics questions

Question

1. Maintain my own perspective and my opinions

Answered: 1 week ago