QUANTITATIVE DECISION MAKING
NAME__________________
MIDTERM TEST
Spring 2005
Points Possible = 100 points
POINTS = ______________
Show all of your work.
Start each problem on a separate page. Submit all
computer output generated in solving the problems.
1.
Given a fixed cost of $50,000 to start a production process.
Once the process has
begun, the variable cost per unit is $25.
The revenue per unit is projected to be
$45.
(10 points)
a.
Write an expression for total cost.
b.
Write an expression for total revenue.
c.
Write an expression for total profit.
d.
Find the breakeven point.
.
2.
A manufacturer makes two products, doors and windows.
Each must be
processed through two work areas.
Work area #1 has 60 hours of available
production time.
Work area #2 has 48 hours of available production time.
Manufacturing of a door requires 4 hours in work area #1 and 2 hours in work
area #2.
Manufacturing of a window requires 2 hours in work area #1 and 4
hours in work area #2.
Profit is $8 per door and $6 per window. (10 points)
a.
Define decision variables that will tell how many units to build (doors and
windows).
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 Spring '10
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 Optimization, Work Area, Use Management Scientist

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