PBL Pathways

Content Area

Business functions, marginal profit, derivatives

Time Frame

2 to 3 weeks with mini-lectures


November 3, 2010


marginal, demand, cost, revenue, profit, derivatives

Project Title

Solar Toasters


David Graser, Yavapai College, Prescott, AZ (David_Graser@yc.edu)


In this project, students use pricing data for a product to come up with a linear demand function. From this function, students then form the corresponding revenue function, cost function and profit function. Finally, the derivative of the profit function, the marginal profit function, is computed and interpreted.

Project Content

Project Letter - DOC | PDF

Scaffolding Resources

Handout: How to Find a Revenue Function - DOC | PDF
Handout: Introduction to Revenue - PDF
Handout: Introduction to Cost -
Handout: Introduction to Break-Even
Technology Assignment: Break-Even Point on the TI-84 and in Excel - PDF


The main issue students have with this project is scaling the units. If the number of toasters is scaled in hundreds, this automatically means that the revenue function is also scaled. If the cost function is not scaled similarly, they are bound to have trouble computing the profit function.

Students also have trouble distinguishing between profit and marginal profit.

I allow students to compute the derivative of the profit function from the definition of the derivative or with the power rule. My emphasis is on interpreting the marginal profit at 2000 units and what that means (ie. how procution should be changed).

