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All Terrain Tires manufactures three different off-road ATV tires: Model A, Model B, and Model C. Plenty of market demand exists for all models. The
All Terrain Tires manufactures three different off-road ATV tires: Model A, Model B, and Model C. Plenty of market demand exists for all models. The table below reports the prices and costs per unit of each product: Model A Model B Model C $40 Selling price Direct materials costs Direct labor costs ($15 per labor hour) Variable support costs ($3 per machine hour) Fixed support costs $15 $3 $10 $50 $5 $15 $6 $10 $55 $5 $30 $9 $10 Assuming that machine hours are limited (i.e., this is the constrained resource), which model is the most profitable to produce
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