Question: TW manufactures two products, the D and the E, using the same material for each. Annual demand for the D is 9,000 units, while demand

TW manufactures two products, the D and the E, using the same material for each. Annual demand for the D is 9,000 units, while demand for the E is 12,000 units. The variable production cost per unit of the D is $10, that of the E $15. The D requires 3.5 kg of raw material per unit, the E requires 8 kg of raw material per unit. Supply of raw material will be limited to 87,000 kg during the year.

A sub-contractor has quoted prices of $17 per unit for the D and $25 per unit for the E to supply the product. How many of each product should TW manufacture in order to maximise profits

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TW should manufacture ........... units of D and .............. units of E to maximise profits.

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