A car rental company can rent 30 cars at a daily rate of $12 per car. For an additional $2 a day charged per car, one fewer car is rented. If the company wants to maximize revenue, what would it charge to rent a car for 1 day ?
I am setting up the demand equation (14-p)/(14-12) = (29 - d)/(29-30) which become p = 72 - 2d.
Revenue = d(72 - 2d) = 72 d - 2d^2
Max revenue is the first derievative equal to zero gives 72 - 4d = 0 and d = 18.
p = 72 - 2(18) = 36.
Is this correct ? Please let me know. Thanks.
I am setting up the demand equation (14-p)/(14-12) = (29 - d)/(29-30) which become p = 72 - 2d.
Revenue = d(72 - 2d) = 72 d - 2d^2
Max revenue is the first derievative equal to zero gives 72 - 4d = 0 and d = 18.
p = 72 - 2(18) = 36.
Is this correct ? Please let me know. Thanks.