Four products are manufactured by MNO:

maxi midi mini micro

Selling price per unit 600 400 300 250

variable labor cost per unit(40$/hour) 250 120 140 90

variable material cost per unit 275 250 100 110

Part 1: Each of the four products takes two production hours. Assuming production hours as the overall capacity constraint, the ranking order of products for MNO to maximize its profitability is:

a. maxi, midi, mini , micro

b. maxi, mini, micro, midi

c. micro, mini, maxi , midi

d. micro, midi, maxi, mini

Applying the theory of constrains and a throughput accounting approach, and assuming labor to be the bottleneck constraint, the ranking order of products for MNO to maximize its profitability within the labor constraint is:

a. maxi,midi,mini, micro

b. micro, mini, maxi, midi

c. maxi, mini, micro, midi

d. micro, midi, maxi, mini