A Company Is Developing Its Weekly Production Plan The Decision Variables Are Defined as
X_i = the Amount

question 71

Multiple Choice

A company is developing its weekly production plan.The company produces two products,A and B,which are processed in two departments.Setting up each batch of A requires $60 of labor while setting up a batch of B costs
$80) Each unit of A generates a profit of $17 while a unit of B earns a profit of $21.The company can sell all the units it produces.The data for the problem are summarized below.
Hours required by
$$\begin{array} { r c c c } \text { Operation } & \text { A } & \text { B } & \text { Hours } \\\hline \text { Cutting } & 3 & 4 & 48 \\\text { Welding } & 2 & 1 & 36\end{array}$$
The decision variables are defined as
X_i = the amount of product i produced Y_i = 1 if X_i > 0 and 0 if X_i = 0
What is the objective function for this problem?

• A)MAX: 17 X₁ + 21 X₂
• B)MAX: 17 X₁ + 21 X₂ ? 60 Y₁ ? 80 Y₂
• C)MIN: 17 X₁ + 21 X₂ ? 60 Y₁ ? 80 Y₂ d.MIN: 60 Y₁ + 80 Y₂

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Definitions:

Stackelberg Duopoly

A model of oligopoly in which one firm (the leader) sets its output or price first, and the other firm (the follower) then chooses its output or price in response, considering the leader's decisions.

Collusive Duopoly

A situation where two firms in a market agree to collaborate, often secretly, to increase their joint profits by agreeing on prices or output levels.

Extensive Form

A representation of a game in decision tree format, showing the sequence of moves, possible strategies, and outcomes.

Credible Threat

In a sequential game with two players, a statement made by Player 1 that truthfully (credibly) threatens a penalizing action against Player 2 if Player 2 does something that Player 1 does not want Player 2 to do. Opposite of empty threat.