A manufacturing company wants to maximize profits on products $A, B$, and $C$. The profit margin is $\$ 3$ for $A, \$ 6$ for $B$, and $\$ 15$ for $C$. The production requirements and departmental capacities are as follows:

-What is the maximum profit if the profit margin on A changes to $\$ 7.00$ ?
A) $\$ 225,000$
B) $\$ 98,000$
C) $\$ 105,000$
D) $\$ 266,000$

Question

A manufacturing company wants to maximize profits on products $A, B$, and $C$. The profit margin is $\$ 3$ for $A, \$ 6$ for $B$, and $\$ 15$ for $C$. The production requirements and departmental capacities are as follows:
 
-What is the maximum profit if the profit margin on A changes to $\$ 7.00$ ?
A) $\$ 225,000$ 
B) $\$ 98,000$ 
C) $\$ 105,000$ 
D) $\$ 266,000$

Quizplus · Accepted Answer

The profit margin on A is currently $\$ 5.00$. If it changes to $\$ 7.00$, the profit will increase by $\$ 2.00$ per unit. Since there are 50,000 units of A, the total profit will increase by $\$ 100,000$. The current profit is $\$ 125,000$, so the maximum profit with the new profit margin will be $\$ 125,000 + \$ 100,000 = \$ 225,000$.

A Manufacturing Company Wants to Maximize Profits on Products A,BA, BA,B

A Manufacturing Company Wants to Maximize Profits on Products $A, B$