Use the information below to answer the following questions.
Computers Expertise Ltd provides three services, the details for which are as follows: $\begin{array}{llll}
& \underline{\text { Basic} }& \underline{ \text { Secretarial }} & \underline{ \text { Expert }}\
\text { Sales price per unit } & \$ 20 & \$ 30 & \$ 50 \
\text { Variable cost per unit } & \$ 10 & \$ 12 & \$ 15 \
\text { (paper, transport, etc.) } & & & \
\text { Labour time per unit } & 1 \text { hour } & 2 \text { hours } & 5 \text { hours } \
\text { Annual fixed costs } & \$ 20,000 & &
\end{array}$
The demand for all service is unlimited. The ability to provide the service is limited by the availability of qualified staff and therefore the labour time available.
-Refer to the table above. Which product is the most profitable?

Question

Use the information below to answer the following questions.
Computers Expertise Ltd provides three services, the details for which are as follows: $\begin{array}{llll}
& \underline{\text { Basic} }& \underline{ \text { Secretarial }} & \underline{ \text { Expert }}\ 
\text { Sales price per unit } & \$ 20 & \$ 30 & \$ 50 \
\text { Variable cost per unit } & \$ 10 & \$ 12 & \$ 15 \
\text { (paper, transport, etc.) } & & & \
\text { Labour time per unit } & 1 \text { hour } & 2 \text { hours } & 5 \text { hours } \
\text { Annual fixed costs } & \$ 20,000 & &
\end{array}$
 The demand for all service is unlimited. The ability to provide the service is limited by the availability of qualified staff and therefore the labour time available.
-Refer to the table above. Which product is the most profitable?

Quizplus · Accepted Answer

Basic provides the highest dollar contribution per labour hour, which means it generates the most revenue per hour of staff time. Therefore, it is the best choice for maximizing profitability.

Use the Information Below to Answer the Following Questions The Demand for All Service Is Unlimited