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Assume a company makes only three products, A, B, and C: Product A Product B Product C Estimated customer demand in units 700 600 800
Assume a company makes only three products, A, B, and C:
Product A | Product B | Product C | ||||||||||||
Estimated customer demand in units | 700 | 600 | 800 | |||||||||||
Selling price per unit | $ | 80 | $ | 65 | $ | 45 | ||||||||
Variable cost per unit | $ | 35 | $ | 26 | $ | 20 | ||||||||
Machine-hours per unit | 2.5 | 3.0 | 1.25 | |||||||||||
The company has only 3,500 machine-hours available. What is the highest total contribution margin that the company can earn if it makes optimal use of its constrained resource?
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