Consider the Following Production and Cost Data for Two Products,L

question 24

Multiple Choice

Consider the following production and cost data for two products,L and C:
$\begin{array}{|l|r|r|}\hline & \text { Product L } & \text { Product C } \\\hline \text { Contribution Margin per Unit } & \$ 130 & \$ 120 \\\hline \text { Machine Setups Needed per Unit } & 10 \text { setups } & 8 \text { setups } \\\hline\end{array}$
The company can only perform 65,000 machine setups each period due to limited skilled labour,and there is unlimited demand for each product.What is the largest possible total contribution margin that can be realized each period?

• A) $845,000.
• B) $910,000.
• C) $975,000.
• D) $1,820,000.

---

Definitions:

Labor Costs

The total expenses associated with employing labor, including wages, benefits, and taxes.

Labor Movement

A collective organizational effort aiming to improve workers' rights, conditions, and wages through unions and other labor associations.

Industrialization

The development of industries in a country or region on a wide scale, characterized by the shift from agrarian to industrial modes of production.

Business Representative

An individual who acts on behalf of a business entity in dealings with others, such as negotiations or partnerships.