Question
Question: A telephone company in a town has 500 subscribers on its list and collects fixed charges of Rs. 300 ...
A telephone company in a town has 500 subscribers on its list and collects fixed charges of Rs. 300 per subscriber per year. The company proposes to increase the annual subscription and it is believed that for every increase of Rs. 1, one subscriber will discontinue the service. What increase will bring maximum income in the company –
A
100
B
10
C
50
D
) 20
Answer
100
Explanation
Solution
Let the increase in fixed charges be Rs. X per subscriber.
So, final income P = (500 – x) (300 + x)
= 150000 + 200x – x2 …(1)
For maximum or minimum of P
= (200 – 2x) = 0 Ž 200 – 2x = 0 Ž x = 100.
= negative\ total income will be max if the increase in fixed charges in Rs. 100/-