A Company Has 100,000 Hours of Capacity and Manufactures Two

question 131

Multiple Choice

A company has 100,000 hours of capacity and manufactures two products,Product X and Product Z.Neither product has enough demand to utilize the entire capacity,but the combined demand of both products exceeds the capacity of the plant.It takes one hour to make one unit of Product X and two hours to make one unit of Product Z.The following information is available:
$\begin{array}{ll}&\text { Product X }&\text { Product Z }\\\text { Units produced from capacity available }&100,000 & 50,000 \\\text { Contribution margin per unit }&\$ 20 & \$ 30\end{array}$
What product or products should be made?

• A) only make Product X
• B) only make Product Z
• C) make Product X to meet customer demand and then make Product Z
• D) make Product Z to meet customer demand and then make Product X

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Definitions:

Molten

Describes a substance that has been heated past its melting point and is in a liquid state, typically referring to metals or glass.

Rotor Bars

Metal bars placed in the rotor of an induction motor that conduct current and interact with the magnetic field to create rotation.

Power Factor

A measure of how effectively electrical power is converted into useful work output, with a range from 0 to 1.