A Company Sells Two Products with Information as Follows Products Are Made by Machine

question 1

Multiple Choice

A company sells two products with information as follows:
$$\begin{array} { | l | r | r | } \hline &{ \text { A } } & { \text { B } } \\\hline \text { Price per unit } & \$ 10.00 & \$ 16.00 \\\hline \text { Variable cost per unit } & \$ 8.00 & \$ 11.00 \\\hline\end{array}$$
Products are made by machine. 4 units of Product A can be made with one machine hour and 2 units of Product B can be made with one machine hour. The company has a maximum of 2,000 machine hours available per month.
- Assume there are no constraints on sales of either product, and the company could choose any product mix they wish. What is the maximum amount of contribution margin that the company could earn in a month?

• A) $16,000
• B) $18,000
• C) $20,000
• D) $22,000

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Definitions:

Symbolic Initiation Rites

Ceremonies or rituals marking the admission of an individual into a new role, status, or community, often containing symbolic elements indicating transformation.

Social Loafing

The tendency for individuals to exert less effort to achieve a goal when they work in a group than when they work alone.

Shared Norms

Established behaviors or beliefs that are accepted and adhered to by a group or society.

Group Socialisation

Dynamic relationship between the group and its members that describes the passage of members through a group in terms of commitment and of changing roles.