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Questions: a. What is the scarce resource in part a) and c) in this scenario? b. In a situation with a scarce resource, in general
Questions:
a. What is the scarce resource in part a) and c) in this scenario?
b. In a situation with a scarce resource, in general what products should a company focus on to maximize profits?
c. Based on your answer to question b, calculate the most important information that you would need to know about the blender and electric mixer.
Outsourcing; scarce resources Callahan Manufacturing has assembled the data appearing below pertaining to two products. Past experience has shown that the unavoidable fixed factory overhead included in the cost per machine hour averages $10. Direct labor is paid $18 per hour. Callahan has a policy of filling all sales orders, even if it means purchasing units from outside suppliers at the same selling price per unit that Callahan currently charges. a. Assume Callahan Manufacturing has 50,000 machine hours available. What would be the optimal production of each product to maximize Callahan's profits? b. Refer to the original information. With all other things constant, if Callahan is able to reduce direct materials cost for the electric mixer by $6 per unit, what strategy should Callahan pursue? c. Refer to the original information. Assume that an outbreak of the flu has left Callahan shorthanded on direct labor personnel. Approximately one-half of the workforce will be out of work for one month. During the month, what strategy should Callahan pursue? Outsourcing; scarce resources Callahan Manufacturing has assembled the data appearing below pertaining to two products. Past experience has shown that the unavoidable fixed factory overhead included in the cost per machine hour averages $10. Direct labor is paid $18 per hour. Callahan has a policy of filling all sales orders, even if it means purchasing units from outside suppliers at the same selling price per unit that Callahan currently charges. a. Assume Callahan Manufacturing has 50,000 machine hours available. What would be the optimal production of each product to maximize Callahan's profits? b. Refer to the original information. With all other things constant, if Callahan is able to reduce direct materials cost for the electric mixer by $6 per unit, what strategy should Callahan pursue? c. Refer to the original information. Assume that an outbreak of the flu has left Callahan shorthanded on direct labor personnel. Approximately one-half of the workforce will be out of work for one month. During the month, what strategy should Callahan pursueStep by Step Solution
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