Need assistance with these 2 problems

jigga18

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May 1, 2006
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1. (Maximum Profit) The total cost of producing x units of A and y units of B is given by C(x,y)= 250 - 4x - 7y + 0.2x^2 + 0.1y^2. If each unit of A sells for $28 and each unit of B sells for $15, find the levels of production of A and B that will maximize the profits for the firm.

here's what I have:

C(28,15)= 250 - 4x - 7y + 0.2x^2 + 0.1y^2

C(28)= -4 +0.4x
x=7.2

C(15)= -7 +0.2y
y= -4

C= 250- 4(7.2) - 7(-4) + 0.2(7.2)^2 + 0.1(-4)^2 = 261.17


2.
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(Maximum Profit) The total cost of producing x units of A and y units of B is given by C(x,y)= 250 - 4x - 7y + 0.2x^2 + 0.1y^2. If each unit of A sells for $28 and each unit of B sells for $15, find the levels of production of A and B that will maximize the profits for the firm.

here's what I have:

C(28,15)= 250 - 4x - 7y + 0.2x^2 + 0.1y^2

C(28)= -4 +0.4x
x=7.2Nope, 0.4x-4=0, x does not equal 7.2

C(15)= -7 +0.2y
y= -4
Nope, 0.2y-7=0, y does not equal -4

You found the marginal cost at 15 and 28, not the maximization

C= 250- 4(7.2) - 7(-4) + 0.2(7.2)^2 + 0.1(-4)^2 = 261.17
 
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