National Business Machines Manufactures Two Models of Fax Machines: a and B

question 68

Multiple Choice

National Business Machines manufactures two models of fax machines: A and B. Each model A cost to make, and each model B cost .The profits are for each model A and for each model B fax machine. If the total number of fax machines demanded per month does not exceed and the company has earmaked no more than $ /month for manufacturing costs, how many units of each model should National make each month to maximize its monthly profit?

• A) Maximize subject to
• B) Minimize subject to
• C) Maximize subject to
• D) Maximize subject to
• E) Maximize subject to

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Definitions:

Fungible Goods

Items that are interchangeable with others of the same type because they are identical in essence and value, such as grains or precious metals.

Average Quality

The median standard of quality among similar products or services, considered acceptable or satisfactory.

Warranty Of Merchantability

The warranty of merchantability is a legal guarantee provided by sellers that goods for sale will meet reasonable quality and usability standards as understood in the marketplace.

Strict Liability

A legal standard that holds a party responsible for their actions or products, regardless of fault or intent.