A manufacturer pays no tax on the first 120 units produced each day
MATHEMATICS · Subjective · CBSE · Mathematics · Applications of Derivatives · Applications of Derivatives
Problem
A manufacturer pays no tax on the first 120 units produced each day, but a $3 per-unit tax is applied to every unit beyond 120. The price-demand relationship is p=50−0.25q, and production cost is $12 per unit with no fixed cost. Determine the daily production level q that maximizes profit.