Asked by Madeline Winterton on May 17, 2024
Verified
The constraint at Dreyfus Inc.is an expensive milling machine.The three products listed below use this constrained resource. 
Required:
a.Rank the products in order of their current profitability from the most profitable to the least profitable.In other words, rank the products in the order in which they should be emphasized.Show your work!
b.Assume that sufficient constraint time is available to satisfy demand for all but the least profitable product.Up to how much should the company be willing to pay to acquire more of the constrained resource?
Constrained Resource
A limited resource within a production or project environment that restricts the output or completion time.
Profitability
A financial metric used to assess a business's ability to generate earnings compared to its expenses and other relevant costs incurred during a specific period of time.
Expensive Milling Machine
A high-cost machine used in manufacturing to shape metal or other materials with high precision.
- Evaluate the use of constrained resources to maximize profitability.
Verified Answer
RM
Ra-ees ManuelMay 21, 2024
Final Answer : 
Resulting ranking of products: AM, QX, VY
b.The company should be willing to pay up to $12.50 per minute to obtain more of the constrained resource since this is the value to the company of using this constrained resource to make more of product VY.By assumption, enough of the other two products will already have been produced to fully satisfy demand.
Resulting ranking of products: AM, QX, VYb.The company should be willing to pay up to $12.50 per minute to obtain more of the constrained resource since this is the value to the company of using this constrained resource to make more of product VY.By assumption, enough of the other two products will already have been produced to fully satisfy demand.
Learning Objectives
- Evaluate the use of constrained resources to maximize profitability.