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Question - The Wester Company produces three products with the following costs and selling prices:
A
B
C
Selling price
$21
$12
$32
VC/u
11
7
18
DHL/u
0.4
0.1
0.7
Machines hours per unit
0.2
0.5
Demand (in units)
300
500
200
The company has insufficient capacity to fulfil all of the demand for these three products.
Required -
If direct labour hours (DHL) are the constraint, then calculate the opportunity cost?
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