Answered step by step
Verified Expert Solution
Question
1 Approved Answer
im's Camera shop sells two high-end cameras, the Sky Eagle and Horizon. The demand for these two cameras are as follows (Ds = demand for
im's Camera shop sells two high-end cameras, the Sky Eagle and Horizon. The demand for these two cameras are as follows (Ds = demand for the Sky Eagle, Ps is the selling price of the Sky Eagle, OH is the demand for the Horizon and PH is the selling price of the Horizon): Ds = 220 - 0.5 Ps + 0.15 PH DH = 275 + 0.2 Ps - 0.52 PH The store wishes to determine the selling price that maximizes revenue for these two products. Select the revenue function for these two models, Choose the correct answer below. (i) Ps Ds + PHDH = PH(275 - 0.2 Ps - 0.52 PH) + Ps( 220 - 0.5 Ps + 0.15 PH) (11) PS DS - PH DH = Ps(220 - 0.5 Ps + 0.15 PH) - PH(275 - 0.2 Ps - 0.52 PH) (ill) Ps Ds + PH DH = Ps(220 - 0.5 Ps + 0.15 PH) + PH(275 + 0.2 Ps - 0.52 PH) (IV) Ps DS - PH DH = Ps(220 + 0.5 Ps + 0.15 PH) - PH(275 - 0.2 Ps - 0.52 PH) Option (iii) Find the prices that maximize revenue. Do not round intermediate calculations. If required, round your answers to two decimal places. Optimal Solution: Selling price of the Sky Eagle (Ps): $ 335.10 Selling price of the Horizon (PH): $ 315.75 Total Revenue: $ 96000
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started