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You are a divisional manager at Kia. Your marketing department estimates that the semiannual demand for the top-end model of the Telluride to be: Q

You are a divisional manager at Kia. Your marketing department estimates that the semiannual demand for the top-end model of the Telluride to be:

Q = 150,000 - 1.5P or P = 100,000 - (2/3)*Q

  1. What price should you charge in order to maximize total revenue from sales?
  2. Is this revenue-maximizing price likely to maximize profit? Use marginal analysis to explain your answer to your senior VP.

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