Question: Suppose that in a certain community, there will be M(r) thousand new houses built when the 30-year fixed mortgage rate is r%, where a. Find

Suppose that in a certain community, there will be M(r) thousand new houses built when the 30-year fixed mortgage rate is r%, where


M(r) 1 + 0.02r 1 + 0.009/


a. Find M'(r) and M"(r).


b. Sketch the graph of the construction function M(r).


c. At what rate of interest r is the rate of construction of new houses minimized?

M(r) 1 + 0.02r 1 + 0.009/

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