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Question - The Wonder Company sells three products which can be sold in any combination so long as no more than 210,000 machine hours are used. All costs are variable (labor and materials) except for the rental cost of the production facility, which is P960,000 per year. The economic data for each product are as follows:
Product L Product M Product N
Selling price per unit 40 30 20
Variable cost per unit 22 18 12
Machine hours per unit 3 hours 4 hours 1 hours
In the absence of any market constraints, what is the most profitable combination of products, and what is the profit?
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