Question: Problem# 1 : ( 3 0 points ) A small chemical company has estimated that the price and the yearly volume produced of its top
Problem#: points
A small chemical company has estimated that the price and the yearly volume produced of its topselling oxidizing agent are related by the following equation:
Where is the price per gallon of the oxidizing agent and is the gallons of the agent produced per year. The associated fixed costs are $ per year and the variable costs are $ per gallon. Use this information to answer the following:
a Write out the full equation for the profit made from selling the oxidizing agent in terms of the volume. points
b Determine the optimal volume of the oxidizing agent to be produced per year in gallons and obtain the maximum profit from the optimal volume. Show all of your calculations here. points
c The company's small capacity plant that produces the agent normally operates for a product rate of to gallons per year. Does the optimal demand from part b fall in this range or not? If no then will the plant have to reduce its capacity or increase it to maximize its profits? points
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