Question

A small business assumes that the demand function for one of its new products can be modeled by p = Cekx. When p = $40, x = 1000 units, and when p = $30, x = 1400 units. (a) Solve for C and k. (Round C to four decimal places and k to seven decimal places.) C = k =

Answer 1

Answer:

C= 82.1116

k=-0.0007192

Step-by-step explanation:

$p=Ce^{kx}\\40=Ce^{k1000}\\30=Ce^{k1400}$

Applying logarithmic properties yields in the following linear system:

$ln(40) = ln(C) + 1000k\\ln(30) = ln(C) + 1400k$

Solving for k:

$ln(40) = ln(C) + 1000k\\ln(30) = ln(C) + 1400k\\400 k = ln(30)-ln(40)\\k=-0.0007192$

Solving for C:

$40=Ce^{-0.0007192*1000}\\C= \frac{40}{e^{-0.0007192*1000}}\\C=82.1116$

C= 82.1116

k=-0.0007192