The manufacturer of GRIPPER tires modeled its return to sale

The manufacturer of GRIPPER tires modeled its return to sales from television advertising expenditures in two regions, as follows: Region 1: = S_1 = 50 + 28x_1 - 0.4x_162 Region 2: S_2 = 30 + 26x_2 - 1.1x_2^2 where Si and S2 are the sales revenue in millions of dollars and x_1 and x_2 are millions of dollars of expenditures for television advertising. (Round your answers to three decimal places.) (a) What advertising expenditures would maximize sales revenue in each district? Region 1 $ 35 million Region 2 $ 11.818 million (b) How much money will be needed to maximize sales revenue in both districts? $ million

Solution

S1 = 50 + 28*35 - 0.4*35^2 = $ 540 million

S2 = 30 + 26*11.818 - 1.1*11.818^2 = $ 183.64 million

Total = S = S1 + S2 = $ 723.64 million