Stone Age Surfboards Is a Small Manufacturer of Two Types

question 5

Multiple Choice

Stone Age Surfboards is a small manufacturer of two types of popular low-tide surfboards, the Graystone and the Lava models. The manufacturing process consists of two departments: fabrication and finishing. The fabrication department has 8 skilled workers, each of whom works
9.25 hours per day. The finishing department has 5 workers, each of whom works a 6-hour shift per day. Each pair of Graystone surfboards requires 2.5 labor hours in the fabrication department and 2 labor hours in finishing. The Lava model requires 4.2 labor-hours in fabrication and 3.6 labor-hours in finishing. The company operates 6 days a week. It makes a per unit profit of $40 on the Graystone model and $60 on the Lava model. The company anticipates selling at least twice as many Lava models as Graystone models.
Use the spreadsheet below for Stone Age Surfboards to answer the following questions) using integer constraints on variables in the optimization models using the standard Solver.
-What is the total profit generated?

• A) $ 748.28
• B) $ 687.46
• C) $ 385.65
• D) $ 500.00

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Definitions:

Firm

An organization, especially one involved in business or commerce, that produces and sells goods or services.

Economic Profit

The difference between a firm's total revenue and its total costs, including both explicit and implicit costs.

Profit-Maximizing Output

The level of production at which a company achieves the highest possible profit, where marginal cost equals marginal revenue.

Firm

A business organization, such as a corporation, partnership, or sole proprietorship, engaged in commercial, industrial, or professional activities.