How To Get Revenue Function From Demand Function

Solution or modeling the revenue function notice that the demand depends on the price of the product.

How to get revenue function from demand function. Stack exchange network consists of 176 q a communities including stack overflow the largest most trusted online community for developers to learn share their knowledge and build their careers. If x is the demand or how many items are sold and p is the price we can then say that x depends on p. If one type of product is being sold at one price the revenue function is simply. A firm s revenue is where its supply and demand curve intersect producing an equilibrium level of price and quantity.

In this video we maximize the revenue from a linear demand function by finding the vertex of a quadratic function. The demand function has the form y mx b where y is the price m is the slope and x is the quantity sold. R revenue p price per unit x number of units sold. As a point you can write p x.

In the example the demand function sets the price of a quart of blueberries to be y 0 25x b. Revenue is product of demand and number of items. Demand revenue cost profit demand function d q p d q in this function the input is q and output p q independent variable p dependent variable recall y f x p d q the price at which q units of the good can be sold unit price p most demand functions quadratic project 1 demand curve which is the graph of d q is generally downward sloping why. The higher the price the less the demand.

If not you must derive the. Calculating the revenue function. In this video we maximize the revenue from a linear demand function by. Price multiplied by quantity at this point is equal to revenue.

For instance if a lemonade stand sold x glasses of lemonade at 50 cents each the revenue function. This video explains how to maximize profit given the cost function and the demand function. R p x.