A CFO is trying to sell a new CXT pickup truck. Surveys conducted of potential consumers show that there is a substantial amount of "buzz" and interest in the new CXT, although many customers were less likely to buy one when they discovered it has poor gas mileage and runs on diesel. This "buzz factor" needs to be taken into consideration when introducing this product to the market. As more products are sold, the buzz is expected to drop. In this situation, one can determine a functional form for "buzz":
B(x) = a - bx2, where a and b are constants bigger than zero.
As a result, your PROFIT then becomes: P(x) = R(x) - C(x) + B(x)
a) How will positive and negative buzz affect the profit?
b) What does x-intercept represent in relation to "buzz" affecting profit?
c) The financial backers are worried that bad buzz will affect profits, and thus want an initial production level that will still yield profit. Can you find a range of production levels where there will still be a profit? How does this range compare to the production levels that yield a profit when you don't consider buzz?
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any or all help appreciated...thanks so much <33
B(x) = a - bx2, where a and b are constants bigger than zero.
As a result, your PROFIT then becomes: P(x) = R(x) - C(x) + B(x)
a) How will positive and negative buzz affect the profit?
b) What does x-intercept represent in relation to "buzz" affecting profit?
c) The financial backers are worried that bad buzz will affect profits, and thus want an initial production level that will still yield profit. Can you find a range of production levels where there will still be a profit? How does this range compare to the production levels that yield a profit when you don't consider buzz?
***
any or all help appreciated...thanks so much <33