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An Electronics Firm Produces Two Models of Pocket Calculators: the A-100

question 71

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An electronics firm produces two models of pocket calculators: the A-100 (A) ,which is an inexpensive four-function calculator,and the B-200 (B) ,which also features square root and percent functions.Each model uses one (the same) circuit board,of which there are only 2,500 available for this week's production.Also,the company has allocated a maximum of 800 hours of assembly time this week for producing these calculators,of which the A-100 requires 15 minutes (.25 hours) each,and the B-200 requires 30 minutes (.5 hours) each to produce.The firm forecasts that it could sell a maximum of 4,000 A-100's this week and a maximum of 1,000 B-200's.Profits for the A-100 are $1.00 each,and profits for the B-200 are $4.00 each.For the production combination of 1,400 A-100's and 900 B-200's,which resource is "slack" (not fully used) ?

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Definitions:

Single Index Model

A simplified financial model that describes the return of a security as a linear function of the return of a single market index, plus some random noise.

Portfolio

A diverse collection of investments held by an individual or institution, including stocks, bonds, real estate, or other financial assets, designed to reduce risk and achieve specific financial goals.

Beta

A measure of the volatility, or systemic risk, of a security or a portfolio in comparison to the market as a whole.

Beta

A gauge for the level of volatility or systematic risk associated with a security or portfolio against the backdrop of the broader market.

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