Use the Following Information to Answer the Question(s) Below -An Unbounded Problem Is One for Which

question 35

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. $\begin{array}{|l|l|l|l|l|l|l|}\hline&{\text { A }} & \text { B } & \text { C } & \text { D } & \text { E } & \text { F } \\\hline& \text { Cerebro } && & & & \\1&\text { ManufacturingModel } & & & & & \\\hline 2\\\hline 3 & \text { Product } & \text { Plugs } & \text { Rails } & \text { Rivets } & \text { Clips }& \begin{array}{l}\text { Machine } \\\text { Capacity } \\\text { (mins./year) }\end{array} \\\hline 4 & \text { Gross margin/unit } & \$ 0.40 & \$ 1.20 & \$ 0.80 & \$ 1.10 & \\\hline 5 & \text { Minutes/unit } & 1 & 2 & 3 & 1.5 & 250,000 \\\hline 6 & \text { Gross margin/minute } & \\\hline 7 & \text { Maximum production } & \\\hline 8 & \text { Profit } & \\\hline\end{array}$
-An unbounded problem is one for which .

• A) the objective is maximized or minimized by more than one combination of decision variables
• B) there is no solution that simultaneously satisfies all the constraints
• C) the objective can be increased or decreased to infinity or negative infinity while the solution remains feasible
• D) there is exactly one solution that will result in the maximum or minimum objective

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Definitions:

Variable Costs

Costs that vary directly with the level of production or output.

Cost-Volume Analysis

A managerial accounting technique used to analyze how various levels of sales and production will affect profit.

Low-Cost Choice

An option that requires minimal financial outlay compared to other alternatives.