s A television station is considering the sale of promotional DVDs. It can have the DVDs produced by one

Questions

A television station is considering the sale of promotional DVDs. It can have the DVDs produced by one of two suppliers. Supplier A will charge the station a set-up fee of $1200 plus $2 for each DVD; supplier B has no set-up fee and will charge $4 per DVD. The station estimates its demand for the DVDs to be given by Q = 1,600 - 200P, where P is the price in dollars and Q is the number of DVDs. The price equation is P = 8 -Q/200.

Suppose the station plans to give away the videos. How many DVDs should it order? From which supplier?
Suppose instead that the station seeks to maximize its profit from sales of DVDS. What price should be charged? How many DVD should it order from which supplier?

Price: $8.07

Solution: The downloadable solution consists of 4 pages, 407 words.
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