Question
9. The proprietor of Two Cats Clothing makes crafts in her spare time and always sells everything she makes at local craft shows. She specializes
9. The proprietor of Two Cats Clothing makes crafts in her spare time and always sells everything she makes at local craft shows. She specializes in three products. But because the owners time is limited before the next craft show, she is trying to decide how to use her time to the best advantage. Information related to the 3 products that Two Cats Clothing produces are as follows:
Rag Dolls Pot Holders Baskets
Contribution margin per unit $8 $2 $12
Contribution margin ratio 40% 25% 32%
Time required per unit (hours) 1.4 0.5 3.5
Which product is the most profitable use of her constrained resource (time)?
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