PRODUCT MIX DECISION WITH UNLIMITED DEMAND Tampa Company makes two models of its hair dryer. The copper-winding machine used in the production of the hairdryers is available for 8.000 minutes per month. The copper-winding machine can produce 4 Standard hairdryers per minute and 2 Premium hairdryers per minute. Data concerning these two products appear below, Sales price per unit Standard Regular $14 Variable cost per unit 5 CM per unit Premium Large $20 5 1. Determine the CM per machine minute for each product. 2. Assuming the demand for either hairdryer is unlimited. Which hairdryer should be manufactured? 3. Based on the answer in #2 and the limits of the copper-winding machine, what is the monthly contribution margin generated by the company? O Learning Objective 6: Analyze outsourcing (make-or-buy) decisions Outsourcing decisions are sometimes called 'make-or-buy" decisions because managers must decide whether to make a product or service in-house or buy it from another company. Outsourced work c be done domestically or overseas. In deciding whether or not to outsource, managers must conside following: How do our variable costs per unit compare to the outsourcing cost per unit? . Are any fixed costs avoidable if we outsource? What could we do with the freed capacity? What volume do we need?