A Company Sells Two Products with Information as Follows The Products Are Machine Made

question 38

Multiple Choice

A company sells two products with information as follows: $$\begin{array} { | l | r | r | } \hline & \mathrm { A } & \mathrm { B } \\\hline \text { Sales price per unit } & \$ 12.00 & \$ 24.00 \\\hline \text { Variable cost per unit } & \$ 10.00 & \$ 12.00 \\\hline\end{array}$$ The products are machine made.Four units of product A can be made with one machine hour and two units of product B can be made with one machine hour.The company has a maximum of 6,000 machine hours available per month.The company can sell up to 18,000 units of product A per month,and up to 3,000 units of product B for the month.What is the optimum product mix to maximize company's operating income?

• A)1,500 units of A and 72,000 units of B
• B)18,000 units of A and 3,000 units of B
• C)zero units of A and 3,000 units of B
• D)36,000 units of A and zero units of B

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Definitions:

Risk Society

A society increasingly preoccupied with the future and also with safety, addressing and managing risks that modernity itself has produced.

Technopoly

A society which is overly dependent on technology, leading to potential negative effects on culture, society, and human well-being.

Technological Determinism

The theory that a society's technology shapes its cultural values, social structure, and history.

Scientific Research

The systematic investigation into and study of materials and sources to establish facts and reach new conclusions.