Q ple makes two products—Quone and Qutwo—

from the same raw material. The selling price and cost details of these products are as shown below:

If materials were limited to 2000 kg per week, the shadow price (opportunity cost) of these materials would be:

(a) nil;

(b) £2.00 per kg;

(c) £2.66 per kg;

(d) £3.40 per kg;

(e) none of these.

Transcribed Image Text:

Selling price Quone Qutwo () () 20.00 18.00 Direct material (2.00/kg) 6.00 5.00 Direct labour 4.00 3.00 Variable overhead unit 2.00 1.50 12.00 9.50 Contribution per unit 8.00 8.50 The maximum demand for these products is: