Question

1-Towards the end of the 20^th century, the U.S. government wanted to save money by closing a small portion of its domestic military installations. While many people agreed that saving money was a desirable goal, people in areas potentially affected by a closing soon reacted negatively. Congress finally selected a panel whose task was to develop a list of installations to close, with the legislation specifying that Congress could not alter the list. Since the goal was to save money, why was this problem so hard to solve?

2-Your car gets 29 miles per gallon (mpg) at 60 miles per hour (mph) and 25 mpg a 70 mph. At what speed should you make a 525-mile trip:
If gas costs $3 per gallon and your time is worth $18 per hour
If gas costs $4 per gallon and your time is worth $12 per hour
If gas costs $5 per gallon and your time is worth $9 per hour

2-A firm is planning to manufacture a new product. As the selling price is increased, the quantity that can be sold decreases. Numerically the sales department estimates:
P = $475 – 0.25Q
Where P = selling price per unit and Q = quantity sold
On the other hand, management estimates that the average unit cost of manufacturing and selling the product will decrease as the quantity sold increases. They estimate
C = $48Q + $22,500
Where C = cost to produce and sell Q per year
The firm’s management wishes to maximize profit. What quantity should be sold? How much profit will be made?

Answer 1