Instructions

DIRECTIONS for the following three questions: Answer the questions on the basis of the information given below.

Rang Barsey Paint Company (RBPC) is in the business of manufacturing paints. RBPC buys RED, YELLOW, WHITE, ORANGE, and PINK paints. ORANGE paint can be also produced by mixing RED and YELLOW paints in equal proportions. Similarly, PINK paint can also be produced by mixing equal amounts of RED and WHITE paints. Among other paints, RBPC sells CREAM paint, (formed by mixing WHITE and YELLOW in the ratio 70:30) AVOCADO paint (formed by mixing equal amounts of ORANGE and PINK paint) and WASHEDORANGE paint (formed by mixing equal amounts of ORANGE and WHITE paint). The following table provides the price at which RBPC buys paints.

Question 35

Assume that AVOCADO, CREAM and WASHEDORANGE each sells for the same price. Which of the three is the most profitable to manufacture?

Solution

Cream would be undoubtedly the most profitable as maximum amount of white paint is used in it and white is the cheapest out of all other paints. Hence option B.


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