What is the effective capacity

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Reference no: EM131928340

Question: A company makes two products A and B, using a single resource pool. The resource is available for 900 minutes per day. The contribution margins for A and B are $20 and $35 per unit respectively. The unit loads are 10 and 20 minutes per unit.

a. Which product is more profitable?

b. The company wishes to produce a mix of 60% As and 40% Bs. What is the effective capacity (units per day)?

c. At the indicated product mix, what is the financial capacity (profit per day)?

Reference no: EM131928340

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