Question
New Year Pyrotechnics (NYP) is a fireworks manufacturing company, Annual celebrations are rapidly approaching, and NYP has only 50 pounds of powder left. NYP manufactures
New Year Pyrotechnics (NYP) is a fireworks manufacturing company, Annual celebrations are rapidly approaching, and NYP has only 50 pounds of powder left. NYP manufactures three types of fireworks: Aerials, Grounders, and Poppers. The following information shows the information regarding the production and sale of the fireworks:
Aerials Grounders Poppers
Pounds of Powder per Unit 2 lbs. 0.75 lbs 0.25 lbs
Contribution Margin per Unit. $30 $10.5 $4
1) Which firework gives NYP the highest contribution margin per pound of powder?
2) Suppose the market demands for Aerials, Grounders, and Poppers are 20 units, 40 units, and 80 units, respectively. How many units of Aerials, Grounders, and Poppers should NYP produce to maximize profit?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started