Use the Following Information to Answer the Question(s) Below -Alternate Optimal Solutions Exist When the

question 50

Multiple Choice

Use the following information to answer the question(s) below.
Cerebro Manufacturing produces four types of structural support fittings-plugs, rails, rivets, and clips-which are machined on two CNC machining centers. The machining centers have a capacity of 250,000 minutes per year. The gross margin per unit and machining requirements are shown in the spreadsheet below. $\begin{array}{|l|l|l|l|l|l|l|}\hline&{\text { A }} & \text { B } & \text { C } & \text { D } & \text { E } & \text { F } \\\hline& \text { Cerebro } && & & & \\1&\text { ManufacturingModel } & & & & & \\\hline 2\\\hline 3 & \text { Product } & \text { Plugs } & \text { Rails } & \text { Rivets } & \text { Clips }& \begin{array}{l}\text { Machine } \\\text { Capacity } \\\text { (mins./year) }\end{array} \\\hline 4 & \text { Gross margin/unit } & \$ 0.40 & \$ 1.20 & \$ 0.80 & \$ 1.10 & \\\hline 5 & \text { Minutes/unit } & 1 & 2 & 3 & 1.5 & 250,000 \\\hline 6 & \text { Gross margin/minute } & \\\hline 7 & \text { Maximum production } & \\\hline 8 & \text { Profit } & \\\hline\end{array}$
-Alternate optimal solutions exist when the .

• A) reduced cost is equal to the shadow price
• B) ratio of the objective coefficient to the constraint coefficient is one
• C) Allowable Increase values for changing cells are zero
• D) final value of the changing cells is greater than that of the constraints

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Definitions:

Fiscal Policy

Government policies related to taxation and spending that are intended to influence economic conditions.

Policy Makers

Individuals or groups responsible for making decisions and setting policies in governmental or corporate sectors.

Phillips Curve

A curve showing possible combinations of the inflation rate and the unemployment rate.

Opportunity Cost

The cost of forgoing the next best alternative when making a decision or choosing to invest in one option over another.