Native Customs Sells Two Popular Styles of Hand-Sewn Footwear: a Sandal

question 11

Essay

Native Customs sells two popular styles of hand-sewn footwear: a sandal and a moccasin. The cost to make a pair of sandals is $18, and the cost to make a pair of moccasins is $24. The demand for these two items is sensitive to the price, and historical data indicate that the monthly demands are given by S = 400 -10P₁ and M = 450 - 15P₂ , where S = demand for sandals (in pairs), M = demand for moccasins (in pairs), P₁ = price for a pair of sandals, and P₂ = price for a pair of moccasins. To remain competitive, Native Customs must limit the price (per pair) to no more than $60 and $75 for its sandals and moccasins, respectively. Formulate this nonlinear programming problem to find the optimal production quantities and prices for sandals and moccasins that maximize total monthly profit.

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Definitions:

Internal Attributions

The process of assigning the cause of behavior to internal characteristics, traits, or abilities of the individual.

External Attributions

The process of attributing the cause of one's own or others' behavior to external factors or situational circumstances.

Individualism

A societal concept that prioritizes individual liberty and autonomy above the interests or management of the group or government.

Dispositional Attributional Bias

The tendency to attribute people's behaviors to their character or personality while underestimating situational influences.