Avocado Ltd produces small electronic components for kitchen appliances. Two of its products are Component Y and Component Z. The selling price of Component Y is $15, and the selling price of Component Z is $20. The variable cost per unit for Component Y is $8 and the variable cost per unit of Component Z is $11. The machine hour requirement and demand for the two products are:
Both Component Y and Component X have to undergo the machining process first, followed by a manual polishing labour process. Avocado Ltd's capacity is 6500 machine hours and 6500 labour hours. The top priority of Avocado Ltd in terms of managing constraints is to:

Question

Avocado Ltd produces small electronic components for kitchen appliances. Two of its products are Component Y and Component Z. The selling price of Component Y is $15, and the selling price of Component Z is $20. The variable cost per unit for Component Y is $8 and the variable cost per unit of Component Z is $11. The machine hour requirement and demand for the two products are: 
Both Component Y and Component X have to undergo the machining process first, followed by a manual polishing labour process. Avocado Ltd's capacity is 6500 machine hours and 6500 labour hours. The top priority of Avocado Ltd in terms of managing constraints is to:

Quizplus · Accepted Answer

Avocado Ltd's capacity constraint is the number of machine hours available. Therefore, investing in additional machines would increase capacity and enable them to produce more of both Component Y and Component Z. The other options do not address the capacity constraint and may not necessarily result in increased profitability.

Avocado Ltd Produces Small Electronic Components for Kitchen Appliances