Market research carried out by Foamy Ltd has demonstrated that for sales at a price of £1.90 per drink demand from retailers would be zero, and that demand will increase, on a straight- line basis, by 20,000 drinks for every 10p (£0.10) fall in price.

Required:

Calculate the sales price at which the company's profit will be maximised, and the profit the company will make at that sales price.

Answer rating: 100% (QA)

Given that the sales are increasing on a straight line method for every Euro 010 fall i... View the full answer