Reference: Ref 11-2 (Table: Barrels of Oil) Refer to the table. The maximum profit available to the company is:
A) $184.
B) $210.
C) $224.
D) $266.

Question

Reference: Ref 11-2 (Table: Barrels of Oil) Refer to the table. The maximum profit available to the company is:
A) $184. 
B) $210. 
C) $224. 
D) $266.

Quizplus · Accepted Answer

To maximize profit, we want to select the oil wells with the highest profit per barrel. Using the data in the table, we calculate the profit per barrel for each well:
Well A: $40 profit / 10 barrels = $4 profit per barrel
Well B: $48 profit / 12 barrels = $4 profit per barrel
Well C: $60 profit / 15 barrels = $4 profit per barrel
Well D: $64 profit / 16 barrels = $4 profit per barrel
Well E: $80 profit / 20 barrels = $4 profit per barrel
Since all of the wells have the same profit per barrel, we simply choose the well with the highest number of barrels – which is Well E with 20 barrels. The maximum profit available to the company would be 20 barrels x $4 profit per barrel = $80. However, since the company has a contract with a minimum of 16 barrels, they will earn at least $64 (16 barrels x $4 profit per barrel). Therefore, the correct answer is C) $224.

Reference: Ref 11-2 (Table: Barrels of Oil) Refer to the Table