The Logistics/operations Manager of a Mail Order House Purchases Two

question 22

Multiple Choice

The logistics/operations manager of a mail order house purchases two products for resale: King Beds (K) and Queen Beds (Q) .Each King Bed costs $500 and requires 100 cubic feet of storage space,and each Queen Bed costs $300 and requires 90 cubic feet of storage space.The manager has $75,000 to invest in beds this week,and her warehouse has 18,000 cubic feet available for storage.Profit for each King Bed is $300,and for each Queen Bed is $150.Which of the following is not a feasible purchase combination?

• A)0 King Beds and 0 Queen Beds
• B)0 King Beds and 250 Queen Beds
• C)150 King Beds and 0 Queen Beds
• D)90 King Beds and 100 Queen Beds
• E)0 King Beds and 200 Queen Beds

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Definitions:

Utility Function

An economic model representing how a consumer ranks different bundles of goods based on the level of satisfaction or utility they provide.

Demand

The quantity of a good or service that consumers are willing and able to purchase at various prices during a given period.

Income

The amount of money received by an individual or group over a certain period, often derived from work, investments, or business activities.

Utility Function

A mathematical formula that represents a consumer's preference ranking for various bundles of goods.