High Flying Copters Manufactures Two Types of Toy Remote Control

question 127

Multiple Choice

High Flying Copters manufactures two types of toy remote control helicopters, small and large. The following per unit data are available: Total fixed costs are $450,000 and the company has a machine hour capacity of 30,000 hours per year.
Which helicopter should they emphasis in production?

• A)Small
• B)Large
• C)Equal amount of both
• D)Cannot determine from information given.

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Definitions:

MRP

The marginal revenue product, which is the additional revenue generated from using one more unit of a factor of production.

Wage Rate

The amount of money paid to an employee per unit of time or for each unit of output produced.

Demand Schedule

A table or graph that shows the quantity of a good or service that consumers wish to buy at each price level.

Marginal Product

The additional output that is generated by employing one more unit of a specific factor of production, keeping other inputs constant.