A Company Produces Two Products (A and B) Using Three

question 101

Short Answer

A company produces two products (A and B) using three resources (I, II, and III). Each product A requires 1 unit of resource I and 3 units of resource II and has a profit of $1. Each product B requires 2 units of resource I, 3 units of resource II, and 4 units of resource III and has a profit of $3. Resource I is constrained to 40 units maximum per day; resource II, 90 units; and resource III, 60 units.
Is the production combination 15 A's and 15 B's feasible?

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Definitions:

Marginal Cost

The cost of producing one additional unit of a good or service, critical for decision-making on production and pricing.

Benefit of Abatement

This refers to the advantages or positive effects derived from reducing or eliminating negative environmental impacts or pollutants.

External Benefits

Positive effects of a product or a decision that are enjoyed by people other than those who decide to produce or consume the product.