Effie Corporation Produces Two Products,P and Q

question 9

Multiple Choice

Effie Corporation produces two products,P and Q.P sells for $8.00 per unit; Q sells for $6.00 per unit.Variable costs for P and Q are $2.00 and $5.00,respectively.There are 7300 direct labor hours per month available for producing the two products.Product P requires 2.00 direct labor hours per unit,and product Q requires 4.00 direct labor hours per unit.The company can sell as many of either product as it can produce.What is the maximum monthly contribution margin that Effie can generate under the circumstances? (Round your answer to nearest whole dollar.)

• A)$21,900
• B)$3650
• C)$43,800
• D)$7300

Understand the concept of equilibrium in the labor market and the factors that can shift demand and supply.

Apply the concept of marginal productivity to determine the optimal number of workers to hire for maximizing profits.

Associate changes in the demand and supply of labor with changes in the equilibrium wage and quantity of labor.

Calculate the value of the marginal product of labor and understand its role in employment decisions.

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Definitions:

Internal Issues

Problems or challenges that arise within an organization, affecting its functioning or performance.

External Issues

Problems or challenges originating outside an organization that can affect its performance and strategic direction.

Customer Perspective

An approach to business that concentrates on understanding and addressing the needs and expectations of customers.

Firm's Characteristics

Specific attributes or qualities that define and differentiate an organization, including its size, scope, resources, capabilities, and culture.