Hint$($s$)$ Check My Work

Eastman Publishing Company is considering publishing an electronic textbook about spreadsheet applications for business. The fixed cost of manuscript preparation, textbook design, and web$-$site construction is estimated to be $$170,000.$ Variable processing costs are estimated to be $$5$ per book. The publisher plans to sell single$-$user access to the book for $$45.$

Through a series of web$-$based experiments, Eastman has created a predictive model that estimates demand as a function of price. The predictive model is demand $=4,000-6p,$ where $p$ is the price of the e$-$book.

$($a$)$ Build a spreadsheet model to calculate the profit$/$loss for a given demand. What is the demand?

$($b$)$ Use Goal Seek to calculate the price that results in breakeven. If required, round your answer to two decimal places.

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$($c$)$ Use a data table that varies price from $$50$ to $$400$ in increments of $$25$ to find the price that maximizes profit.

If Eastman sells the single$-$user access to the electronic book at a price of: it will earn a maximum profit of $