Product X Requires 10 Machine Hours Per Unit to Be

question 80

Multiple Choice

Product X requires 10 machine hours per unit to be produced,Product Y requires only 6 machine hours per unit,and the company's productive capacity is limited to 240,000 machine hours.Product A sells for $32 per unit and has variable costs of $12 per unit.Product B sells for $24 per unit and has variable costs of $7 per unit.Assuming the company can sell as many units of either product as it produces,the company should:

• A) Produce only Product X.
• B) Produce only Product Y.
• C) Produce equal amounts of X and Y.
• D) Produce X and Y in the ratio of 62.5% X to 37.5% Y.
• E) Produce X and Y in the ratio of 40% X and 60% Y.

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Definitions:

Consideration Set

A group of brands or products that a consumer evaluates as choices for a potential purchase.

Rackspace U.S. Inc.

An American managed cloud computing company that offers a broad set of cloud services across multiple platforms.

Consideration Set

A group of brands or products a consumer evaluates as potential options to satisfy a need or purchase decision.

Product Class

Refers to the entire product category or industry.