Bounds Inc. determined through regression analysis that its sales (S) are a function of the amount of

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Bounds Inc. determined through regression analysis that its sales (S) are a function of the amount of advertising (measured in units) in two different media. This relationship is given by the following equation (X = newspapers, Y = magazines):

S(X, Y) = 200X + 100Y − 10X2 − 20Y2 + 20XY

a. Find the level of newspaper and magazine advertising that maximizes the firm’s sales.

b. Calculate the firm’s sales at the optimal values of newspaper and magazine advertising determined in part (a).

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Managerial economics applications strategy and tactics

ISBN: 978-1439079232

12th Edition

Authors: James r. mcguigan, R. Charles Moyer, frederick h. deb harris

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Question Posted: Dec 03, 2012 02:29 AM

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Bounds Inc. determined through regression analysis that its sales (S) are a function of the amount of

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a Sales S 200X 100Y 10X 2 20Y 2 20XY Where X and Y are the amount units spe...View the full answer

Managerial economics applications strategy and tactics

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