Question $4$: Choosing the product mix when capacity is in short supply

You have three product lines: Basic, Premium, and Supreme. You have limited capacity of $300$ machine hours. You face excess demand for all three products $($assume unlimited demand for simplicity$).$

Basic Premium Supreme

Price per unit $$6,000$ $$14,000$ $$20,000$

Unit variable cost $$2,000$ $$4,000$ $$6,000$

Machine hours per unit $124$

Compute the CM per unit of capacity $($i$.$e$,$ per machine$-$hour$)$ for each product:

Basic $=$ $

$4000$

Correct: Your answer is correct.

per hour

Premium $=$ $

$5000$

Correct: Your answer is correct.

per hour

Supreme $=$ $

$3500$

Correct: Your answer is correct.

per hour

Which product$($s$)$ should you make?

Premium only

Supreme only

Basic only

Make all three products to take advantage of the high demand

Correct: Your answer is correct.

How many units of each product should you make? $($enter $0$ for products that you do not want to make$)$

Basic $=$

$0$

Correct: Your answer is correct.

units

Premium $=$

$299$

Incorrect: Your answer is incorrect.

units

Supreme $=$

$0$

Correct: Your answer is correct.

units

Hint if you get stuck: You have $300$ machine hours.