A Grocery Store Manager Must Decide How to Best Present

question 39

Multiple Choice

A grocery store manager must decide how to best present a limited supply of milk and cookies to its customers. Milk can be sold by itself for a profit of $1.50 per gallon. Cookies can likewise be sold at a profit of $2.50 per dozen. To increase appeal to customers, one gallon of milk and a dozen cookies can be packaged together and are then sold for a profit of $3.00 per bundle. The manager has 100 gallons of milk and 150 dozen cookies available each day. The manager has decided to stock at least 75 gallons of milk per day and demand for cookies is always 140 dozen per day. To maximize profits, how much of each product should the manager stock.
Which of the following is the constraint that limits the amount of milk the store will use (both in bundles and sold separately) each day?

• A) M + B ≥ 100
• B) M + B ≤ 100
• C) M + B ≥ 75
• D) M + B ≤ 75
• E) M ≤ 100

---

Definitions:

Net Income

The total profit of a company after all expenses and taxes have been subtracted from total revenue.

Financing Activities

Transactions and events that relate to how a company finances its operations, including issuing debt, repaying loans, and issuing or buying back stock.

Net Cash Provided

The total amount of cash inflows minus cash outflows from a company's operating, financing, and investing activities.

Cash Dividends

are payments made by a company to its shareholders out of its profits or reserves, representing a portion of the company's earnings.