00:01
So here we are asked to set up a model for profits.
00:03
We're told that demand is equal to 2 ,500 minus 3p, and we're told that costs are equal to 5 ,000 plus 5d.
00:15
Right.
00:16
So let's think about the model for the total profit.
00:19
Profit is equal to revenue minus costs.
00:25
But revenue is just the price times the demand, right? the quantity demanded, how many are sold times the price minus the costs, which is equal to 2 ,500 minus 3p times p.
00:39
If we sub in the demand function, we get a function in terms of p, and then similarly, we get a cost function as well, right, minus 5 ,000 plus 5d.
00:54
So this is a partial step, but you see that we still have this d, but we can also sub in for this d as well if we are feeling so inclined, right? because we have an expression for d...