Riverside Industries Makes Two Products and Each Product Is Processed

question 40

Multiple Choice

Riverside Industries makes two products and each product is processed in three departments. The time requirements for each product in each department are given below. The profit for each product is also provided as well as the available hours in each department.
$$\begin{array} { c c c c c } \text { Product } & \text { Department A } & \text { Department B } & \text { Department C } & \text { Profit } \\\mathbf { 1 } & 3 & 4 & 2 & 1 \\\mathbf { 2 } & 2 & 1 & 2 & 2\\Available~ Hours&600&400&400\end{array}$$ Management wants to achieve three goals. The first two goals are equal in priority.
Priority 1: Produce at least 125 units of product 1.
Priority 1: Produce at least 80 units of product 2.
Priority 2: Achieve a profit of at least 300.
-If the second goal was to produce no more than 80 units of product two, the objective function would be:

• A) Min P₁d₁- + P₁d_2-, P₂d_3-
• B) Min P₁d₁₊ + P₁d_2-,P₂d_3-
• C) Min P₁d_1- + P₁d₂₊, P₂d_3-
• D) Min P₁d_1- + P₁d_2-, P₂d₃₊

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Definitions:

Equity-Financed

A method of raising capital through the sale of shares in a company, thereby giving investors ownership interests.

Price Per Share

The market value of a single share of a company's stock, determined by the supply and demand for it in the stock market.

Post-Merger Firm

A company that results from the combination of two or more companies into one entity following a merger.

Cash Acquisition

A method of acquiring another company by purchasing its assets or stock with cash payments.