A retailer has a bargain bin containing items to be sold at $10 each. At this price they sell 25 items per day. The average retail cost of the items in the bin is $5. To stimulate sales they plan to lower the price for items in the bin and estimate that for each 25 cent reduction in price, 5 more items will be sold each day. How should the items in the bin be priced to maximize total daily profit if the price must remain between $7 and $10 per item?

Answer rating: 100% (QA)

If the price is increased by 50 cent the number of items sold per day will decrease by 25 10 35 ... View the full answer