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Advertising Campaign The marketing division of a large firm has found that it can model the sales generated by an advertising campaign as $$ S(u)=0.75 \sqrt{u}+1.8 \text { millions of dollars } $$ when the firm invests \(u\) thousand dollars in advertising. The firm plans to invest $$ u(x)=-2.3 x^{2}+53 x+250 \text { thousand dollars } $$ each month where \(x\) is the number of months after the beginning of the advertising campaign. a. Write the model for predicted sales \(x\) months into the campaign. b. Write the formula for the rate of change of predicted sales \(x\) months into the campaign. c. What will be the rate of change of sales when \(x=12 ?\)

Short Answer

Expert verified
a. Use \(S(x) = 0.75 \sqrt{-2.3x^2 + 53x + 250} + 1.8\) for sales. b. Rate of change formula: \(\frac{0.75(-4.6x + 53)}{2\sqrt{-2.3x^2 + 53x + 250}}\). c. When \(x=12\), rate is \(-0.035\) million dollars/month.

Step by step solution

01

Determine Monthly Sales Model

To find the model for predicted sales, substitute the monthly investment function \(u(x) = -2.3x^2 + 53x + 250\) into the sales function \(S(u) = 0.75 \sqrt{u} + 1.8\). This gives us: \[ S(x) = 0.75 \sqrt{-2.3x^2 + 53x + 250} + 1.8. \]
02

Substitute and Simplify Sales Model

Thus, the expression for sales in terms of \(x\) is: \[ S(x) = 0.75 \sqrt{-2.3x^2 + 53x + 250} + 1.8. \] This equation will be used to find the predicted sales \(x\) months into the campaign.
03

Rate of Change of Sales Model

To find the rate of change of sales, we need to take the derivative of \(S(x)\) with respect to \(x\), which involves using the chain rule. Let \(v(x) = -2.3x^2 + 53x + 250\), then \(S(x) = 0.75 \sqrt{v(x)} + 1.8\). Use the chain rule: \[ \frac{d}{dx}(S(x)) = 0.75 \cdot \frac{1}{2\sqrt{v(x)}} \cdot \frac{d}{dx}(v(x)). \]
04

Differentiate Investment Model

Differentiate \(v(x) = -2.3x^2 + 53x + 250\), we get: \[ \frac{d}{dx}(v(x)) = -4.6x + 53. \]
05

Apply Chain Rule to Complete Derivative

Substituting \( \frac{d}{dx}(v(x)) = -4.6x + 53\) into the derivative expression from Step 3, we get: \[ \frac{d}{dx}(S(x)) = 0.75 \cdot \frac{1}{2\sqrt{-2.3x^2 + 53x + 250}} \cdot (-4.6x + 53). \] Simplifying further, \[ \frac{d}{dx}(S(x)) = \frac{0.75(-4.6x + 53)}{2\sqrt{-2.3x^2 + 53x + 250}}. \]
06

Calculate Rate of Change at x=12

Substitute \(x = 12\) into \( \frac{d}{dx}(S(x)) \) to find the rate of change of sales: \[ \frac{d}{dx}(S(x)) \bigg|_{x=12} = \frac{0.75(-4.6(12) + 53)}{2\sqrt{-2.3(12)^2 + 53(12) + 250}}. \] Calculate inside the square root: \(-2.3(144) + 636 + 250 = -331.2 + 636 + 250 = 554.8\), therefore \[ \frac{d}{dx}(S(x)) \bigg|_{x=12} = \frac{0.75(-55.2 + 53)}{2\sqrt{554.8}}. \] Simplify: \[ \frac{d}{dx}(S(x)) \bigg|_{x=12} = \frac{0.75(-2.2)}{2 \times 23.544} = \frac{-1.65}{47.088} \approx -0.035. \] Thus, the rate of change of sales when \(x=12\) is approximately \(-0.035\) million dollars per month.

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Key Concepts

These are the key concepts you need to understand to accurately answer the question.

Advertising Campaign
An advertising campaign is a strategic set of advertising messages that share the same idea and theme which make up an integrated marketing communication. In the context of calculus, especially within an algebraic model, an advertising campaign often aims to optimize how much to invest in marketing over time to produce the highest sales revenue.
An advertising campaign can be modeled mathematically to predict how changes over time, in terms of investment, will affect the outcome, which is crucial for making strategic business decisions. In this exercise, the marketing division uses a mathematical model to understand its sales in response to its monetary investment in advertising.
This specific model relates the firm’s ad spend, depicted as a quadratic function of time, to the predicted sales, which utilizes functions from calculus. This approach allows marketers to visualize the impact of time and dollars spent on advertising, making the projection and planning phases much more systematic and data-driven.
Rate of Change
In calculus, the rate of change represents how a quantity changes with respect to another. It's a critical concept since it describes not just the size of a change, but how fast or slow that change occurs.
For this exercise, the rate of change refers to how predicted sales figures adjust as time progresses within the advertising campaign. The rate of change is crucial for businesses to understand; it empowers marketers to discern if their sales are increasing or decreasing and by what rate.
  • This is found by calculating the derivative of the sales model with respect to time.
  • The result provides a snapshot of how effective the advertising investments are over individual months.
Calculating the rate of change allows businesses to adjust their strategies by either increasing or decreasing their investment based on sales performance.
Derivative Calculation
The calculation of a derivative is fundamental in determining the rate of change within calculus.
To find the derivative of a function like the sales model in this exercise, which is defined as a function of another function, we use the chain rule. The chain rule is essential when you're dealing with composite functions, as is the case here.
For the advertising sales model:
  • We start with substituting the investment function into the sales function.
  • Next, we apply the chain rule, which helps us find the derivative of the composite function.
In essence, the chain rule allows us to differentiate the nested function, providing insights into how small changes in time affect sales. This specific calculation is a beneficial skill as it applies broadly to various real-world problems beyond just advertising.
Optimization Problem
An optimization problem in calculus involves finding the maximum or minimum value of a particular function. This is an important concept when managing limited resources, like an advertising budget.
For businesses, optimization allows for making the most out of their investment by determining the point at which either sales are maximized or the cost is minimized.
In this exercise, although not explicitly solved, the idea implies that marketers could use the models to adjust their investments monthly, aiming to optimize the sales outcome.
  • The optimization process involves setting the derivative (rate of change) to zero to find critical points.
  • Those critical points, upon further analysis (using second derivatives or other tests), can indicate where maximum sales occur or where a change in strategy is required.
Understanding optimization within a calculus context equips marketers with powerful tools to improve decision-making for the success of their campaigns.

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