The Operations Manager of a Mail Order House Purchases Double $\le$

question 8

Multiple Choice

The operations manager of a mail order house purchases double (D) and twin (T) beds for resale. Each double bed costs $500 and requires 100 cubic feet of storage space. Each twin 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 double bed is $300 and for each twin bed is $150.
-What is the storage space constraint?

• A)100D + 100T \(\le\) 18,000.
• B)100D + 90T \(\ge\) 18,000.
• C)300D + 90T \(\le\) 18,000.
• D)500D + 100T \(\le\) 18,000.
• E)100D + 90T \(\le\) 18,000.

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Definitions:

Efficiency

The extent to which resources are used optimally to achieve a specific outcome with minimal waste.

Incentives

Factors, usually financial or material rewards, that motivate individuals or firms to act in a certain way.

OPEC

The Organization of the Petroleum Exporting Countries (OPEC) is an intergovernmental organization of oil-producing countries that coordinates and unifies the petroleum policies of its member states.

Efficient Allocation

The distribution of resources in a way that maximizes the net benefit to society or achieves a desired outcome effectively.