You Have Just Been Hired as Manager of a New

question 20

Essay

You have just been hired as manager of a new health spa in Retirement Village,Florida.The owner has commissioned a market study that estimates the average customer's monthly demand curve for visiting the health spa to be Q^d = 50 - 0.25P.The cost of operating is C(Q)= 3Q,where Q is the number of visits.The owner has been charging a $20 per month membership fee and a $5 per visit fee.Part of your salary is 10 percent of the monthly profits.Suggest a pricing strategy that will increase your salary.

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Definitions:

Ordered Pairs

Pairs of numbers used to represent positions on a graph, with the first number indicating horizontal position and the second number indicating vertical position.

Cubes

A cube is a three-dimensional solid object bounded by six square faces, or in mathematics, the result of multiplying a number by itself twice.

Ordered Pairs

Pairs of numbers used to represent points on a graph, with the first number indicating horizontal position and the second number vertical position.

Function

In mathematics, a relation between a set of inputs and a set of permissible outputs with the property that each input is related to exactly one output.