Maximum and Minimum Problems - Pre-Calculus

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Question

The profit of a certain cellphone manufacturer can be represented by the function

where is the profit in dollars and is the production level in thousands of units. How many units should be produced to maximize profit?

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Answer

We can determine the production level that maximizes profit by taking the derivative of our function. This can be done using the power rule.

We then set this derivative equal to 0 and solve.

We can factor out our greatest common factor and then divide it out.

Next we can factor.

Therefore, we can solve

We remember that these production levels are in thousands of units.

However, a factory cannot produce negative cellphones, so the maximum profit is obtained when seven thousand units are produced.

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