In Attempting to Improve Profitability When Faced with a Bottleneck

question 91

Multiple Choice

In attempting to improve profitability when faced with a bottleneck that is involved in the production of two or more products,which of the following is most important for management to consider?

• A)Contribution margin per unit for each product
• B)Time required for each different product passing through the bottleneck
• C)Selling price or sales revenue generated by each product produced through the bottleneck
• D)Contribution margin per bottleneck hour for each product

---

Definitions:

Toll Road

A toll road is a public or private roadway for which a fee is assessed for passage. It generates revenue used for road construction, maintenance, or other transportation expenses.

Clean Air

Refers to the state of the atmosphere when it is free from pollutants and contaminants, enhancing environmental health and quality of life.

Too Little Consumption

A situation where individuals or the economy as a whole are consuming less than optimal, possibly leading to underutilization of resources and a decrease in economic wellbeing.

Nonexcludable

A characteristic of public goods where it is not feasible to exclude individuals from using the good, leading to potential free-rider problems.