Question
13. Shravani plc has three products all of which require the same production facilities. Financial data on the three products are as follows: PRODUCT X
13. Shravani plc has three products all of which require the same production facilities. Financial data on the three products are as follows: PRODUCT X Y Z per unit per unit per unit Labour: skilled 10 15 20 Labour: unskilled 3 6 3 Materials 9 12 15 Variable Overheads 8 12 16 Share of Fixed Overheads 10 15 20 All three of the products use just one raw material, which is the same material for all three products. This material costs 12 a kilo and is scarce. The company has adequate production capacity to satisfy the market demand for all three the products. All labour is a variable cost. Product X is sold in a market where the selling price per unit is fixed at 60. What is the price at which the business would need to sell product Y such that it would be equally profitable to produce and sell any one of the three products?
A) 85 B) 94 C) 124 D) 104
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