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A company manufactures three face masks; turmeric, charcoal and flaxseed. Details for the products and resource requirements are as follows: Turmeric Charcoal Flaxseed Sales price
A company manufactures three face masks; turmeric, charcoal and flaxseed. Details for the products and resource requirements are as follows: Turmeric Charcoal Flaxseed Sales price $320 $250 $360 Variable cost $240 $190 $210 Machine time 0.50 0.25 0.40 Weekly demand 8,000 3,000 2,500 There are 5,000 machine hours available during the quarter. Annual fixed costs are estimated at $2,500,000. Assume that fixed cost accrues evenly throughout the year. Required: 1. Calculate the optimal product mix for the quarter. (9 marks) 2. Calculate the optimal profit for the quarter. (7 marks) 3. Explain, giving two (2) examples, what a limiting factor is. (4 marks)
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