The Owner of Crackers, Inc

question 77

Multiple Choice

The owner of Crackers, Inc. produces both Deluxe (D) and Classic (C) crackers. She only has 4,800 ounces of sugar, 9,600 ounces of flour, and 2,000 ounces of salt for her next production run. A box of Deluxe crackers requires 2 ounces of sugar, 6 ounces of flour, and 1 ounce of salt to produce. A box of Classic crackers requires 3 ounces of sugar, 8 ounces of flour, and 2 ounces of salt to produce. Profits are 40 cents for a box of Deluxe crackers and 50 cents for a box of Classic crackers. Cracker's, Inc. would like to maximize profits.
What is the objective function?

• A) P = 0.5D + 0.4C
• B) P = 0.2D + 0.3C
• C) P = 0.4D + 0.5C
• D) P = 0.1D + 0.2C
• E) P = 0.6D + 0.8C

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Definitions:

Imported Good

A product or service brought into one country from another for use, sale, or consumption.

Comparative Advantage

Economic theory suggesting that a party should specialize in producing and trading goods that it can produce at a lower opportunity cost than others, leading to increased efficiency and profit.

Trading Partners

Countries or entities that engage in the exchange of goods and services through import and export activities.

Balance-of-Trade Surplus

A situation where the value of a country's exports exceeds the value of its imports, indicating a net positive flow of domestic currency from foreign markets.