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Table 5.2 A Company Makes Four Products That Have the Following Characteristics

question 6

Multiple Choice

Table 5.2
A company makes four products that have the following characteristics: Product A sells for $75 but needs $20 of materials and $20 of labor to produce; Product B sells for $90 but needs $45 of materials and $20 of labor to produce; Product C sells for $110 but needs $50 of materials and $30 of labor to produce; Product D sells for $135 but needs $75 of materials and $40 of labor to produce. The processing requirements for each product on each of the four machines are shown in the table.

Work centers W, X, Y, and Z are available for 40 hours per week and have no setup time when switching between products. Market demand is 50 As, 60 Bs, 70 Cs, and 80 Ds per week. In the questions that follow, the traditional method refers to maximizing the contribution margin per unit for each product, and the bottleneck method refers to maximizing the contribution margin per minute at the bottleneck for each product.
-Use the information in Table 5.2. Using the traditional method, what is the optimal product mix?

Definitions:

Gas Exchange

The process by which organisms exchange gases with their environment, including the uptake of oxygen and the release of carbon dioxide.

Periderm

is the protective outer secondary layer of bark in woody plants and trees, comprising the phellem, phellogen, and phelloderm.

Sapwood

The outer, younger part of a tree's trunk or branch that is active in transporting water and minerals from the roots to the leaves.

Secondary Xylem

Plant tissue that transports water and nutrients upwards from the roots; it also provides structural support and is a major component of wood.