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(Solved): The following diagram shows the flow process, raw material costs, and mochine processing time for t ...




The following diagram shows the flow process, raw material costs, and mochine processing time for three products: A, B, and C
a. Assuming that sales personnel are paid on a commission basis, which product should they selr?
Product A
Product \( \mathrm
The following diagram shows the flow process, raw material costs, and mochine processing time for three products: A, B, and C. There are three machines , and used in the production of these products; the times shown are in required minutes of production per unit. Raw material cost-are shown in cost per unit of product. The market will take all that can be produced. a. Assuming that sales personnel are paid on a commission basis, which product should they selr? Product A Product Product C b. On the basis of maximizing gross profit per unit, which product should be sold? Product A Product Product B c. To maximize total profit for the firm, which product should be sold? Product A Product B Product


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Answer a) Since sales personals are unaware of the processing time, hence they would try to sell all of Product A and none of B or C. However, maximum
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