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.

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Definitions:

Regression Trend Line

A line graphed in scatter plot data to represent the average direction of the data points and understand the relationship between variables.

Regression Technique

A statistical method used to analyze the relationship between a dependent variable and one or more independent variables.

Linear Trend Line

A straight line that best represents the data on a scatter plot, showing the direction and rate of a linear relationship between two variables.

Regression Analysis

A set of statistical processes for estimating the relationships among variables, typically used to determine how the typical value of a dependent variable changes when any one of the independent variables is varied.