Question

The management of a division National Motor Corporation that produces compact and subcompact cars has estimated that the quantity demanded of their compact models is 1400 units/week if the price of oil increases at a higher than normal rate, whereas the quantity demanded of their subcompact models is 2200 units/week under similar conditions. However, the quantity demanded of their compact models and subcompact models is 2800 units and 1800 units/week, respectively, if the price of oil increases at a normal rate. Determine the percentages of compact and subcompact cars the division should plan to manufacture to maximize the expected number of cars demanded each week. (Round your answers to the nearest percent.)

compact cars :_____%

subcompact cars :_____%

Answer 1