Question

the sticker warehouse sells rolls of stickers for $4.00 each. the average custiomer buys six rolls of stickers. the owner finds that for every $0.25 decrease in price , the average customer buis an additional roll.
a) with how many price reductions will the revenue per customer be $30?
b) what is the maximum predicted sales revenue per customer? with how many price reductions will this occur?

Answer 1

A) 4 price reductions.

B) The maximum predicted sales revenue per customer is $30.25 which occurs with 5 price reductions.

As a matter of interest, the $30 revenue per customer also occurs with 6 price reductions but this happens after reaching the maximum predicted revenue per customer of $30.25.