The general rule for relaxing a short term constraint for direct materials is that managers would be willing to pay what they are already paying as well as some or all of the contribution margin per unit of the constrained resource.

Question

Quizplus · Accepted Answer

Managers are typically willing to pay up to the current cost of direct materials plus some or all of the contribution margin per unit that is generated by the use of those materials, especially when dealing with a short-term constraint. This is because the contribution margin represents the additional profit generated per unit of the constrained resource, making it a valuable consideration in decision-making processes related to resource allocation and pricing.

The General Rule for Relaxing a Short Term Constraint for Direct