Question

4. Mendota Company produces two products, Product X and Product Y. The selling price and variable costs for Product X are $45 and $24, respectively. The selling price and variable costs for Product Y are $52 and $27, respectively. Both products use two types of labor, from two separate pools of employees: specialized labor employees and general labor employees. For the coming quarter, the specialized labor pool has 17,000 hours available and the general labor pool has 32,000 hours available. Each unit of Product X uses 0.50 hour of specialized labor and 2 hours of general labor, per unit. Each unit of Product Y uses 1 hour of specialized labor and 1.75 hours of general labor, per unit. Which of the following statements are true? Mendota's most constrained labor type is the specialized labor because both products use up specialized labor before they use up the general labor. O None of the above O Mendota's most constrained labor type is the general labor because both products use up general labor before they use up the specialized labor. O Mendota's most constrained labor type is specialized labor because it has fewer hours available.

Answer 1

Let compute how many units can be produced with each labor hour
Product x takes 0.50 hour of specialised labor and 2 hour of general labor
So from 17000 specialised hours, it could produce 17000/0.5 = 34000 units of product x and from 32000 general labor hours could produce 32000/2= 16000 units of product x
So for product x , general labor is constrained item , because it is used up faster than specialised hours

Product y  takes 1 hour of specialised labor and 1.75 hour of general labor
So from 17000 specialised hours , it could produce 17000/1 = 17000 units of product y and from 32000 general labor hours could produce 32000/1.75 = 18285 units of product y
So for product y , specialised labor is constrained item , because it is used up faster than general labor hours

so for both products the constrained items is different also fewer labor hours doesn't make specialized labor an constraint

SO answer is NONE OF THE ABOVE