Two Stores Are Located Side by Side and Attract Customers

question 38

Multiple Choice

Two stores are located side by side and attract customers to each other and to themselves by advertising.Where x₁ and x₂ are the advertising expenditures of stores 1 and 2, the profits of the firms are (48 + x₂) x₁ - 2(x₁) ² for store 1 and (54 + x₁) x₂ - 2(x₂) ² for store 2.Knowing these functions, one investor buys both stores.In order to maximize his total profits, how much should he spend on advertising for store 1?

• A)$10
• B)$26
• C)$25
• D)$35
• E)None of the above.

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Definitions:

Mechanoreceptors

Sensory receptors in the body that respond to mechanical pressures or distortions, such as touch, pressure, stretch, and vibration.

Chemoreceptors

Sensory receptors that respond to chemical stimuli, found in various locations in the body and involved in processes like taste, smell, and respiratory control.

Dementia

A chronic or progressive syndrome marked by the deterioration of cognitive function, affecting memory, thinking, orientation, comprehension, calculation, learning capacity, language, and judgment.

Agitated

A state of increased restlessness or excitement, often displaying as physical or verbal outbursts, which can indicate distress or discomfort.