Thread: mahesh

hi sir,

good morning. I need a solution for the following problem.

If a certain commoditie's price is increasing at 2% and its production is increasing at 5 % annualy then at what rate revenue increases?

Originally Posted by mahesasarma

hi sir,

good morning. I need a solution for the following problem.

If a certain commoditie's price is increasing at 2% and its production is increasing at 5 % annualy then at what rate revenue increases?

Revenue = (Number of Commodity) times (Unit Price)
Revenue = Production times Unit Price
R = P*u
Differentiate both sides with respect to time t,
dR/dt = P*du/dt +u*dP/dt

Since dP/dt = +5%, and du/dt = +2%, then,
dR/dt = P*(2%) +u*(5%) -----------------------answer.