This is a typical fixed-cost product mix model. The company must decide how much, if any, of
Fantastic news! We've Found the answer you've been seeking!
Question:
This is a typical fixed-cost product mix model. The company must decide how much, if any, of each product to produce, where a fixed cost is charged for each product that is produced at a positive level. The problem is to maximize total profit, subject to the resource constraints and the maximum production constraints. Which of the following is true when comparing the model with fixed costs to the with no fixed costs? Note: When you run Solver for the fixed-cost model, make sure the Integer Optimality % is set to 0, to ensure that you find the optimal solution.
Transcribed Image Text:
Pl B D F G H M This is a typical fixed-cost product mix model. The company must decide how much, if any, of each product to produce, where a fixed cost is charged for each product that is produced at a positive level. The problem is to maximize total profit, subject to the resource constraints and the maximum production constraints. Which of the following is true when comparing the model with fixed costs to the with no fixed costs? Note: When you run Solver for the fixed-cost model, make sure the Integer Optimality % is set to 0, to ensure that you find the optimal solution. 1 Click here to reference the data needed to answer the question. a. In both models, all products produced at a positive level are produced at their maximum production levels. 4 b. Both models have exactly the same optimal production levels. 5 c. When there are no fixed costs, the optimal total profit is at least $6,000 larger than when there are fixed costs. d. All of these choices are true. 7 Product mix model with fixed costs 9 Resources used per unit of product produced 10 11 Resource 1 12 Resource 2 Product 1 Product 2 Product 3 Product 4 Product 5 Product 6 Product 7 Product 8 2,0 2,5 2,3 2,0 2,2 2,5 2,4 2,8 2,5 2,3 2,0 2,9 2,9 2,1 2,5 2,6 2,5 13 Resource 3 2,2 2,1 2,4 2,3 2,0 2,9 2,6 14 Resource 4 15 16 Inputs on products 17 Unit revenue 2,8 2,4 2,4 2,7 2,1 2,0 2,2 2,5 $25,30 $15,90 $9,40 $1.800 $22,50 $13,80 $8,70 $1.600 $29,60 $21,90 $7,70 $1.400 $22,70 $21,80 $12,90 $8,90 $1.000 $27,30 $23,00 $17,50 $5,50 $20,70 $16,00 $6,70 $1.800 18 Unit variable cost 19 Unit margin 20 Fixed cost 21 Maximum production 22 23 Decisions 24 Produce any? 25 26 Units produced 27 28 Effective capacity 29 $19,50 $7,80 $1.100 $15,20 $5,50 $1.700 $1.400 560 550 550 500 490 400 570 410 80 Constraints on resources 31 32 Resource 1 Used Available 12500 83 Resource 2 6000 34 Resource 3 35 Resource 4 36 87 Monetary outputs 38 Total revenue 11000 イー 5000 39 Total variable cost a0 Total fixed cost 31 Total profit 42 Pl B D F G H M This is a typical fixed-cost product mix model. The company must decide how much, if any, of each product to produce, where a fixed cost is charged for each product that is produced at a positive level. The problem is to maximize total profit, subject to the resource constraints and the maximum production constraints. Which of the following is true when comparing the model with fixed costs to the with no fixed costs? Note: When you run Solver for the fixed-cost model, make sure the Integer Optimality % is set to 0, to ensure that you find the optimal solution. 1 Click here to reference the data needed to answer the question. a. In both models, all products produced at a positive level are produced at their maximum production levels. 4 b. Both models have exactly the same optimal production levels. 5 c. When there are no fixed costs, the optimal total profit is at least $6,000 larger than when there are fixed costs. d. All of these choices are true. 7 Product mix model with fixed costs 9 Resources used per unit of product produced 10 11 Resource 1 12 Resource 2 Product 1 Product 2 Product 3 Product 4 Product 5 Product 6 Product 7 Product 8 2,0 2,5 2,3 2,0 2,2 2,5 2,4 2,8 2,5 2,3 2,0 2,9 2,9 2,1 2,5 2,6 2,5 13 Resource 3 2,2 2,1 2,4 2,3 2,0 2,9 2,6 14 Resource 4 15 16 Inputs on products 17 Unit revenue 2,8 2,4 2,4 2,7 2,1 2,0 2,2 2,5 $25,30 $15,90 $9,40 $1.800 $22,50 $13,80 $8,70 $1.600 $29,60 $21,90 $7,70 $1.400 $22,70 $21,80 $12,90 $8,90 $1.000 $27,30 $23,00 $17,50 $5,50 $20,70 $16,00 $6,70 $1.800 18 Unit variable cost 19 Unit margin 20 Fixed cost 21 Maximum production 22 23 Decisions 24 Produce any? 25 26 Units produced 27 28 Effective capacity 29 $19,50 $7,80 $1.100 $15,20 $5,50 $1.700 $1.400 560 550 550 500 490 400 570 410 80 Constraints on resources 31 32 Resource 1 Used Available 12500 83 Resource 2 6000 34 Resource 3 35 Resource 4 36 87 Monetary outputs 38 Total revenue 11000 イー 5000 39 Total variable cost a0 Total fixed cost 31 Total profit 42
Expert Answer:
Answer rating: 100% (QA)
ALL PICTURE ARE IN EXCEL A 1 Product 2 B D Demand Profit 400000 Fixed ... View the full answer
Posted Date:
Students also viewed these general management questions
-
A small electric generating plant must decide how much low-sulfur (2%) and high-sulfur (6%) oil to buy. The final mixture must have a sulfur content of no more than 4%. At least 1200 barrels of oil...
-
A winemaker in Barrossa Valley must decide how much of two types of wine she will produce from a particular variety of grapes. Each litre of table wine yields $8 profit, while each litre of dessert...
-
The Gleason Supermarket's manager must decide how much of each ice cream flavour he should stock so that customer demands are satisfied but unwanted flavours don't result in waste. The ice-cream...
-
Bob Bristol just called to congratulate you on your excellent work on the various assignments at CII.He now wants you to do some capacity analysis for Meghan Willoughby, the Chief Purser. Meghan is...
-
The Trump World Tower is a 72 story luxury condominium building constructed at 845 United Nations Plaza in Manhattan, New York. Before the building was constructed, 845 UN Limited Partnership (845...
-
1. What are some strategic considerations in establishing a pay structure at Nutriment? 2. Should Jack suggest a pay policy to lead, lag or match the market? Explain your recommendation. 3. Explain...
-
Calculate the interquartile range for each of the following sets of data: a. \(1,2,2,3,4,5,7,10\) b. \(21,8,17,7,12,19,5,12\) c. \(6,9,5,14,3,15,19,7,13,6,8,5\) d....
-
Rex loves to work with his hands and is very good at making small figurines. Three years ago, Rex opened Bronze Age Miniatures (BAM) for business as a sole proprietorship. BAM produces miniature...
-
Derive an expression for V = V(x,t) of the glider at the bottom of the incline plane by applying the kinematic equations of motion. x = distance traveled by glider t = time for glider to travel...
-
1. Based on the facts presented in the case, how should the recruiter analyze the data? Hint: Can the recruiter obtain the information needed to make a decision by simply looking at the worksheet?...
-
e'y x+y A surface is defined by the following equation: z(x,y)=- a) Find the equation of the tangent plane to the surface at the point P(0, -2). Present your answer in the exact form (don't use a...
-
What is the difference between the process model and the continuous change process model in the context of planning and implementing organizational change?
-
Examine the benefts of culture and comment on the role of symbolic action.
-
Explain what is meant by prejudice and discrimination and discuss the factors that give rise to prejudice.
-
Highlight the problems with teambuilding, and suggest means of tackling them.
-
What is the difference between role complexity and role ambiguity?
-
The home country of your corporation has very clear and universally accepted standards of human rights and strict laws regarding corruption. You are about to start a very large and profitable entity...
-
1. Below is depicted a graph G constructed by joining two opposite vertices of C12. Some authors call this a "theta graph" because it resembles the Greek letter 0. a. What is the total degree of this...
-
The choice of \(\cot (\theta / 2)\) for the chordwise variation of the pressure coefficient gives the \(1 / \varepsilon^{1 / 2}\) type singularity at the leading edge and \(\varepsilon^{1 / 2}\) type...
-
Obtain the subsonic doublet expression Eq. 5.25 with taking the derivative of Eq. 5.24 with respect to \(\mathrm{z}\). Eq. 5.25 Eq. 5.24 (x, y, z, t) = -Ae+(Mx-R)] t)-Ae" (Mx-R) R iw ( + a R
-
Using the general solution for the first order differential equations obtain the relation between the velocity potential and the acceleration potential.
Study smarter with the SolutionInn App