A Company Has 10,000 Hours of Capacity and Manufactures Two

question 111

Multiple Choice

A company has 10,000 hours of capacity and manufactures two products.Product 1 takes 2 hours per unit.Product 2 takes 3 hours per unit.The contribution margin per unit for Product 1 is $5.The contribution margin per unit for Product 2 is $6.Neither product has enough demand to use all of the plant capacity,but the demand for both products exceeds the plant capacity.Which product or products should be manufactured?

• A) 5,000 units of Product 1 and 0 units of Product 2
• B) 0 units of Product 1 and 5,000 units of Product 2
• C) make Product 1 first until meet customer demand, then make Product 2
• D) make Product 2 first until meet customer demand, then make Product 1

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Definitions:

Fisher's Exact

A statistical significance test used in the analysis of contingency tables where sample sizes are small.

Expected Frequency

The number of occurrences predicted in a category of a contingency table based on probabilistic models.

Political Preference

An individual's inclination or bias toward one or more political parties, ideologies, or policy positions.

Respondents

Individuals who provide data or answers to questions in a survey or study.