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A firm has a limited number of machine hours = 20,000 per year. It has prioritised the use of the machine hours based on the

A firm has a limited number of machine hours = 20,000 per year. It has prioritised the use of the machine hours based on the products that maximize the contribution margin per machine hour. It has worked out the sales mix for three of its products and has 2000 machine hours left to make product D. Based on the following data for product D, how many units of D could it make with the remaining machine hours?

Contribution margin per unit = $10, machine hours required to make one unit = 0.5 machine hours.

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4000 units

2000 units

1000 units

3000 units

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