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The company Carey inc. manufactures three products, P1, P2 and P3 which use , among other things, a common machine with a maximum annual capacity
The company Carey inc. manufactures three products, P1, P2 and P3 which use, among other things, a common machine with a maximum annual capacity of 100,000 machine hours. The products P1, P2 and P3 require respectively 2, 4 and 3 machine hours for their manufacture. Based on the information contained in the following table, what is the level of production of each product that will optimize the margin on variable costs for the entire company? Variable cost margin per unit: P1 = $ 6 P2 = $ 8 P3 = $ 10 Expected demand in units: P1: 10,000 P2: 10,000 P3: 15,000 Please choose an answer: a) P1 = 10,000 P2 = 10,000 P3 = 13,333 b) P1 = 10,000 P2 = 8,750 P3 = 15,000 c) P1 = 7,500 P2 = 10,000 P3 = 15,000 d) P1 = 10,000 P2 = 10,000 P3 = 15,000 e) none of the above
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