In our product-mix example discussed in class (Week 6), how can it maximize profit if a minimum demand of 100 pounds for each drug also must be met?Partial structure is given as below.Pounds made1001001001001020100AvailableProduct1234564500 Labor65432.51.51600 Raw Material3.22.61.50.80.70.3Unit price12.51163Variable cost6.55.73.62.82.21.2Demand960928104197710841055Unit profit cont.ProfitAvailableLabor Used<=Raw Material Used<=

Profit maximization is the act of strategy of the company to produce the products at that level at…

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how can it maximize profit if a minimum demand of 100 pounds for each drug also must be met?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Pricing

Pricing is used as a term in finance and economics, pricing is the process of fixing a value for a product or a service. Pricing establishes a value for a product or service that the customer has to pay. A business can choose from different strategies while deciding to set prices.

Question

In our product-mix example discussed in class (Week 6), how can it maximize profit if a minimum demand of 100 pounds for each drug also must be met?
Partial structure is given as below.
Pounds made
100
100
100
100
1020
100
Available
Product
1
2
3
4
5
6
4500 Labor
6
5
4
3
2.5
1.5
1600 Raw Material
3.2
2.6
1.5
0.8
0.7
0.3
Unit price
12.5
11
6
3
Variable cost
6.5
5.7
3.6
2.8
2.2
1.2
Demand
960
928
1041
977
1084
1055
Unit profit cont.
Profit
Available
Labor Used
<=
Raw Material Used
<=

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