Previous Year Paper
CAT2007Previous Years Paper
Mr David manufactures and sells a single product at a fixed price in a niche market. The selling price of each unit is Rs 30. On the other hand, the cost, in rupees, or producing x units is 240 + bx + cx², where b and c are some constants. Mr David noticed that doubling the daily production from 20 to 40 units increases the daily production cost by . However, an increase in daily production from 40 to 60 units results in an increase of only 50% in the daily production cost. Assume that demand is unlimited and that Mr David can sell as such as he can produce. His objective is to maximize the profit.
What is the maximum daily profit, in rupees, that Mr. David can realize from his business?
A  840

B  760

C  620

D  920

E  Cannot be determined

Maximum daily profit = f (100)
= –1000 + 2000 – 240
= Rs 760
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