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

question 11

True/False

A company sells two products with information as follows:
$$\begin{array} { | l | r | l | } \hline & { \text { A } } & { \text { B } } \\\hline \text { Sales price per unit } & \$ 18 & \$ 26 \\\hline \text { Variable cost per unit } & \$ 7 & \$ 16 \\\hline\end{array}$$ Products are made by machine.Five units of product A can be made with three machine hours and five units of product B can be made with 0.6 machine hour.If there are no constraints on production or sales of either product,then the company should emphasize sales of product B.

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Definitions:

Break-Even Analysis

A financial calculation to determine the point at which revenue received equals the costs associated with receiving the revenue, indicating no net loss or gain.

Business Plan

A business plan is a formal written document that outlines a company's objectives, strategies, market analysis, financial forecasts, and operational procedures for achieving these goals.

Financial Plan

A detailed strategy outlining how a business will maintain its financial health, including projections for income, expenses, and investment needs.

Macro-Environment

Refers to the broad external conditions that can impact businesses and industries, such as economic trends, social changes, technological advances, environmental factors, and political policies.