GetAround, Inc. assembles and sells two products-scooters and motorcycles. The contribution margin is $400 per unit...

  

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GetAround, Inc. assembles and sells two products-scooters and motorcycles. The contribution margin is $400 per unit of scooter and $200 per unit of motorcycle. < Further information about the two products is as follows: < Scooters Motorcycles < < per-unit time on Production Line #1 < 6 hours 4 hours per-unit time on Production Line #2 10 hours 0 hours weekly demand < 50 units 45 units Production Line #1 has 120 hours of available time per week. Production Line #2 has 100 hours of available time per week. Scooters must move through the production lines sequentially (i.e., from Production Line #1 to Production Line #2) to be completed. < Production Line #1 has 120 hours of available time per week. Production Line #2 has 100 hours of available time per week. Scooters must move through the production lines sequentially (i.e., from Production Line #1 to Production Line #2) to be completed. < W Required: < a. GetAround's objective is to maximize weekly contribution margin given its constraints. Based on the above information, how many scooters and motorcycles should Get Around produce in order to maximize its weekly contribution margin? (Note that Get Around can choose to produce X units of scooters and Y units of motorcycles.) (10 points) b. If GetAround can choose to allocate 30 hours of additional capacity to either Production Line #1 OR Production Line #2 (but not both), which line should the manager choose to add this additional capacity? Please justify your answer. (5 points) GetAround, Inc. assembles and sells two products-scooters and motorcycles. The contribution margin is $400 per unit of scooter and $200 per unit of motorcycle. < Further information about the two products is as follows: < Scooters Motorcycles < < per-unit time on Production Line #1 < 6 hours 4 hours per-unit time on Production Line #2 10 hours 0 hours weekly demand < 50 units 45 units Production Line #1 has 120 hours of available time per week. Production Line #2 has 100 hours of available time per week. Scooters must move through the production lines sequentially (i.e., from Production Line #1 to Production Line #2) to be completed. < Production Line #1 has 120 hours of available time per week. Production Line #2 has 100 hours of available time per week. Scooters must move through the production lines sequentially (i.e., from Production Line #1 to Production Line #2) to be completed. < W Required: < a. GetAround's objective is to maximize weekly contribution margin given its constraints. Based on the above information, how many scooters and motorcycles should Get Around produce in order to maximize its weekly contribution margin? (Note that Get Around can choose to produce X units of scooters and Y units of motorcycles.) (10 points) b. If GetAround can choose to allocate 30 hours of additional capacity to either Production Line #1 OR Production Line #2 (but not both), which line should the manager choose to add this additional capacity? Please justify your answer. (5 points)

Answer rating: 100% (QA)

To maximize profits we need to determine the optimal production quantities for scooters and motorcyc... View the full answer