When There Is a Production Constraint, the Company Should First

question 12

Multiple Choice

When there is a production constraint, the company should first produce the product with:

• A)The highest contribution margin per unit
• B)The highest contribution margin ratio
• C)The highest revenue per unit
• D)The highest contribution margin per unit of the constrained resource

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Definitions:

Coffee Fund

Informally refers to a pool of money collected for buying coffee or sometimes used as a casual fund for small group expenses.

Allocated

Distributed or assigned for a specific purpose or to a particular person.

Compute

To calculate or process information, often using a computer or mathematical algorithms.

Company Earned

The total revenue or profit generated by a company over a specific period.