Business Mathematics II
Team HW 3
Prepared for
Math 115b, Section ______
Instructor :Ratnayaka
University of Arizona
By
Team #
Submitted on
Date: ___________________
We, the undersigned, affirm that we all participated fully and equally in the completion of this assignment. By
signing our names, we are certifying that we have verified that the contributions from each member are original
and will not violate the Student Code of Conduct, the Code of Academic Integrity, or the policies and
procedures established for this course. If any part of this work is found to be in violation, we understand and
agree that it will be pursued to the full extent according to University policy. We understand that sanctions may
be imposed individually and/or jointly and that our Team Contribution documents will be used in the process of
determining appropriate sanctions.
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You must provide a printout of the excel formulas used, graphs, sample data & workings for the problems)
Problem 1 (i) Find the price, per dinner, that will result in the sale of 2,600 buffalo steak dinners. (ii) What
revenue can be expected from 2,600 dinners?
Problem 2 Suppose that the demand function for a good is given by D(q)  0.1  q  150 . (i) Use Graphing.xls
to plot D(q) and the revenue function, R (q ) . (ii) Estimate the price that will yield the greatest revenue.
Problem 3 Suppose that D(q)  0.00006  q 2  250 is the demand function for a certain model of audio
speaker. (i) Use Graphing.xls to plot D(q) and the revenue function, R (q ) . (ii) Estimate the price that will
yield the greatest revenue.
Problem 4 The demand function for a new type of car alarm system is shown in the following plot.
DEMAND FUNCTION
500
D (q ) in $
400
300
200
100
0
0
100
200
300
q in K's
400
500
600
Note that the quantities sold are given in thousands. Estimate the revenue (in dollars) from selling 300,000
alarms.
*Problem 5 (i) Use your team’s data and Trend Lines to find the formula for a quadratic demand function. (ii)
Plot D(q) and R (q ) for your team’s product. Use the same units as in the work on the class project in the sheet
Functions of Marketing Focus.xls.
Problem 6 (i) Find the cost of preparing 1,500 buffalo steak dinners. (ii) What revenue can be expected from
preparing and selling 1,500 dinners? (iii) What weekly profit can be expected from preparing and selling 1,500
dinners?
Problem 7 Estimate the percentage drop in weekly profit that would result from dropping the price of buffalo
steak dinners from $22 to $20.
Problem 8 Suppose that the demand function for a good is given by D(q) = 0.1q + 150. Suppose that the
fixed cost for producing this good is C0  $12,000 and that the variable costs are given by VC(q)  1300  q .
(i) Use Graphing.xls to plot D(q) and P (q ) . (ii) Use your graphs to estimate the number of units that should
be produced, and how they should be priced in order to attain the maximum profit. (iii) Approximately what
maximum profit might be expected?
Problem 9 Refer to the demand & cost functions whose graph is shown below.
DEMAND FUNCTION
COST FUNCTION
500
C (q ) in millions of $
140
D (q ) in $
400
300
200
100
0
120
100
80
60
40
20
0
0
100
200
300 400
q in K's
500
600
0
100
200
300
400
q in K's
500
600
Note that the quantities of alarms are given in thousands and the total costs are given in millions of
dollars. (i) Estimate the number of alarms that would be sold at a price of $250 each. (ii) Estimate the revenue
(in dollars) that would result from the sale of alarms priced at $250. (iii) Estimate the cost (in dollars) of
producing the alarms that would be sold at $250. (iv) Estimate the profit (in dollars) that would result from the
sale of alarms at $250.
* Problem 10 Plot C (q ) { plot this function using the user defined COST function, you need to import
thisfrom Marketing Focus.xls } and P (q ) for your team’s data. Use the same units as in the work on
theclassproject in the sheet Functions of Marketing Focus.xls.