Sensitivity of Data: Use the data in exercise 1 3- 1 7 to answer each of the
Question:
Sensitivity of Data: Use the data in exercise 1 3- 1 7 to answer each of the independent questions that follow.
Required:
a. How much contribution is given up if a minimum production of 25 units of A is required?
b. How much contribution is given up if a minimum production of 15 units of B is required?
c. What would be the increased contribution margin from relaxing the polishing constraint to allow production of 40 units of A, or 40 units of B, or some combination along a straight line that would connect those two production points?
d. What would be the increased contribution from relaxing the grinding constraint so that the company could produce 50 units of A or 25 units of B or some combination along a straight line that would connect those two production points?
Step by Step Answer: