Vin Pinball Machines, Inc. makes two types of pinball machines: the SM pinball machine and the Zelda
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Question:
Vin Pinball Machines, Inc. makes two types of pinball machines: the SM pinball machine and the Zelda pinball machine. Vintage Pinball has the following unit-level data for the two products:
- How many SM pinball machines and Zelda pinball machines, respectively, should Vintage Pinball Machines produce per month, taking into account the welding machine limitation of 100 hours per month?
- Are there any ways you can think of that could allow Vin Pinball Machines to relax the constraint at the welding machine? Provide some examples.
SM Pinball Machine | Zelda Pinball Machine | |
Selling price per unit | $2,000 | $2,500 |
Variable cost per unit | $1,000 | $2,000 |
Contribution Margin per unit | $1,000 | $500 |
Contribution Margin ratio | 50% | 20% |
Units demanded per month | 100 | 75 |
Time Needed on Welding Machine per unit | 2.5 hours | 1 hour |
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