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28 Feb 2024, 22:33
Kudos
Bookmarks
Number of
units purchased
from Supplier X: 20 Number of
units purchased
from Supplier Y: 15
units purchased
from Supplier X: 20 Number of
units purchased
from Supplier Y: 15
Be sure to select an answer first to save it in the Error Log before revealing the correct answer (OA)!
Difficulty:
75%
(hard)
Question Stats:
62% (03:22) correct
38%
(03:31)
wrong
based on 1653
sessions
History
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Not Attempted Yet
A company purchased at least 10 units of a certain product from each of Suppliers X and Y. Supplier X charged a $100 fixed cost, $20 per unit for each of the first 10 units, and $5 per unit for each unit purchased in excess of 10 units. Supplier Y charged a $150 fixed cost, $15 per unit for each of the first 10 units, and $10 per unit for each unit purchased in excess of 10 units. Including the fixed costs, the combined average cost for the units was $20 per unit.
Select a number of units purchased from Supplier X and a number of units purchased from Supplier Y that are jointly consistent with the given information. Make only two selections, one in each column.
Select a number of units purchased from Supplier X and a number of units purchased from Supplier Y that are jointly consistent with the given information. Make only two selections, one in each column.
ID: 700233
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Number of units purchased from Supplier X |
Number of units purchased from Supplier Y |
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| 15 | ||
| 20 | ||
| 22 | ||
| 25 | ||
| 27 | ||
| 30 |
ShowHide Answer
Official Answer
Number of
units purchased
from Supplier X: 20 Number of
units purchased
from Supplier Y: 15
units purchased
from Supplier X: 20 Number of
units purchased
from Supplier Y: 15
05 Mar 2024, 01:07
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Bookmarks
Atleast 10 units from each product means min. 10 products of X and 10 products of Y.
Cost = Fixed cost + Cost of first 10 products + Cost of remaining products.
For X,
Cost = 100 + 20x10 + 5 (X-10) ----[1]
For Y,
Cost = 150 + 10x10 + 10 (Y-10) ----[2]
Avg price per unit is 20.
Therefore,
([1] + [2])/ (X+Y) = 20
On solving above equation we get ,
3X + 2Y = 90
Hence from answer options we have X = 20 , Y = 15.
Cost = Fixed cost + Cost of first 10 products + Cost of remaining products.
For X,
Cost = 100 + 20x10 + 5 (X-10) ----[1]
For Y,
Cost = 150 + 10x10 + 10 (Y-10) ----[2]
Avg price per unit is 20.
Therefore,
([1] + [2])/ (X+Y) = 20
On solving above equation we get ,
3X + 2Y = 90
Hence from answer options we have X = 20 , Y = 15.
Quote:
Video solution given here: https://youtu.be/waWVH6zPj-4
We know that at least 10 units were bought from each supplier.
Cost of first 10 units from X = 100 + 20*10 = 300
Cost of first 10 units from Y = 150 + 15*10 = 300
So on average cost of first 20 units was $30 per unit. Now additional units are bought at cheaper price of $5 per unit or $10 per unit. The average price of all these additional units would be between $5 and $10 say it is $n. But the overall average is $20 which is closer to the $30 price. Hence number of additional units bought must be less than 20.
Of the given options, there are only 2 possible options - 15 and 20 (additional units 15) or 15 and 22 (additional units 17). In all other cases, additional units will be more than 20 which is not acceptable. We will check for one of them. If that doesn't work, we know that the other one will.
Try additional units 15. Then the weights are 15 and 20 which means that
\(\frac{3}{4} = \frac{(30 - 20)}{(20 - n)}\)
\(x = $\frac{20}{3}\)
This is the average of $5 and $10.
\(\frac{w1}{w2} = \frac{(10 - 20/3)}{(20/3 - 5)} = 2:1\)
Hence 10 additional units were bought at $5 and 5 additional units were bought at $10. So 20 units were bought from X and 15 were bought from Y.
ANSWER: 20 from X and 15 from Y
Note that the solution looks long with multiple calculations but while solving it, you can do it directly on a single number line (using scale method). It happens much faster (shown in the video)
Here is the video solution of this question:
https://youtu.be/waWVH6zPj-4
For scale method of weighted averages, check:
https://www.youtube.com/watch?v=_GOAU7moZ2Q
