SCARCE RESOURCE
System
Posts: 100,534 🤖 Admin 🤖
I'M NOT REALLY UNDERSTANDING THIS CAN ANY ONE HELP?<BR>PLEASE......
0
Comments
-
SCARCE RESOURCE
You make two products - A & B.<BR><BR>A gives a greater profit than B.<BR><BR>You can't make all of both, as you have a limited supply of raw material.<BR><BR>So you make as many of A as you need, with the raw material left you make as many of B as you can.<BR><BR>Same with limited labour, etc.<BR><BR>Scott.0 -
SCARCE RESOURCE
Scotty thanks<BR>Dec 2004 exam<BR><BR> a b c<BR>con p. unit 27 52 43<BR>labour hr.p.u .5 4 1<BR>con p.limit factor 54 13 43<BR><BR><BR>got this far.....then i get stuck<BR>I'm told <BR>max units of sale =<BR> 1000 200 500<BR><BR>?????? I have the answers but don't understand how to get there....<BR>0 -
SCARCE RESOURCE
TUTTI<BR>The contribution per<b>limiting factor</b> is the key<BR>As soon as you know this for each product you can rank them in order<BR><BR>Then look at the amount of limited resource available<BR>and allocate it in sequence starting with the one which gives the highest contribution per limiting fator<BR><BR>This means that you are likely to make as many of the highest ranked product as you can sell, but there may not be enough resource to make as many as you could sell of the lowest ranked one<BR><BR>So the ranking determines the production mix<BR><BR>0 -
SCARCE RESOURCE
Thanks the penny just dropped ( probably down the drain)<BR>I take the labour hour per unit X hours available<BR>in order of the most profitable first<BR>0 -
SCARCE RESOURCE
(If you have 3 products)<BR><BR>First find the contribution per unit<BR><BR>Then find scarce resource per unit<BR><BR>Then find contribution per scarce resource<BR><BR>Rank in order of highest contribution per unit to lowest<BR><BR>Make as many of the highest you can sell<BR><BR>Than as many of the second as you can sell<BR><BR>then as many of the last as the scarce resource will allow0