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4) StoreAway produces platsic storage bins for household storage needs. The company makes two sizes of bins: Large and Regular. Demand for the product is
4) StoreAway produces platsic storage bins for household storage needs. The company makes two sizes of bins: Large and Regular. Demand for the product is so high that the company can sell as many of each size as it can produce. The same machinery is used to produce both sizes. The machinery is available for only 2,800 hours per period. The company can produce 12 large bins every hour (each bin takes 5 minutes) compared to 16 regular bins in the same amount of time (each bin takes 3.75 minutes). Fixed expenses amount to $120,000 per period. Sales prices and variable costs are as follows: Large 10.20 Sales price per unit Variable cost per unit Regular 8.40 $ 3.00 $ $ $ 4.40 Which product should they emphasize and why? If the demand for regular bins is 38,400 units and demand for large bins is 22,000 units, how many of each size would the company makes to maximize profits
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