Question

22. Assuming a company has net income, which of the following statements is TRUE regarding the contribution margin per unit?

a.	It will decrease as the number of units sold increases.
b.	It will decrease as the number of units sold decreases.
c.	It indicates the amount that net income will increase with the sale of each additional unit.
d.	It indicates the amount that variable costs will decrease with the sale of each additional unit.

46 What combination of x and y is a feasible solution that maximizes the value of the objective function (and satisfies all constraints)?

                                 Max ($4x + $7y)

                                 S.T. 2x + 4y < 12           

                                          5x + 2y < 30

                             

                                            X, Y > 0

              A.    x = 0; y = 3

              B.   x = 0; y = 5

              C.    x = 5; y = 0

              D.    x = 6; y = 0

E.    x = 4; y = 1

Except for violating the non-negativity constraint, a solution that satisfies all the other constraints of a linear programming problem is called

A. feasible

B. infeasible

C. semi-feasible

D. optimal

Answer 1

1. Assuming a company has net income the following is true regarding contribution margin per unit

Option b.It will decrease as the number of units sold decreases.

Other options not correct reasoning:

Contribution per unit is nothing but after deducting variable expenses, amount obtained. This is directly proportional to units sold. Hence if units sold decreases, contribution margin per unit decreases

2. What combination of x and y is a feasible solution that maximizes the value of the objective function (and satisfies all constraints)?

                                 Max ($4x + $7y)

                                 S.T. 2x + 4y < 12           

                                          5x + 2y < 30

                                                        X, Y > 0

                Option E. X =4, Y = 1

Put x=4 and y =1 in above constraints, then only all the four contraints are satisfied

3. Except for violating the non-negativity constraint, a solution that satisfies all the other constraints of a linear programming problem is called

Option C. Semi feasible solution