A Business Makes Three Different Products, the Details of Which

question 11

Multiple Choice

A Business makes three different products, the details of which follow: $\begin{array}{llll}\text { Product code } & \mathrm{A} 1 & \mathrm{~A} 2 & \mathrm{~A} 3 \\\text { Selling price } & \$ 50 & \$ 46 & \$ 40 \\\text { Variable cost } & \$ 20 & \$ 24 & \$ 16 \\\text { Weekly demand-units } & 50 & 40 & 60 \\\text { Machine time per unit } & 4 \text { hours } & 4 \text { hours } & 6 \text { hours }\end{array}$ The maximum machine time available is 350 hours per week. How many machine hours should be spent manufacturing product A3?

• A)35 machine hours
• B)240 machine hours
• C)120 machine hours
• D)None

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Definitions:

Account

A record or statement that details financial transactions and their impact on an entity's financial position.

Guaranteed Annual Rate

The minimum annual return promised to an investor by an investment product, regardless of market conditions.

Fixed Rate

An interest rate that remains the same throughout the entire term of a loan, investment, or financial product.

Stocks

Shares of ownership in a company that entitle the holder to a claim on part of the company’s assets and earnings.