Question
MEM manufactures two products. Product X has a contribution margin of $26 and requires 4 hours of machine time. Product Y has a contribution margin
MEM manufactures two products. Product X has a contribution margin of $26 and requires 4 hours of machine time. Product Y has a contribution margin of $14 and requires 2 hours of machine time. The weekly demand for each product is 1,500 units. Assuming that machine time is limited to 3,000 hours per week, how should it allocate the machine time to maximize its income?
Select one:
a. Use 3,000 hours to produce only X
b. Use 2,250 hours to produce X and 750 hours to produce Y
c. Use 3,000 hours to produce only Y
d. Use 1,500 hours to produce X and 1,500 hours to produce Y
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