When an organization faces multiple constraints for multiple products, what kind of quantitative analysis needs to be performed?
A) Use the same technique as for a special order
B) No quantitative analysis, because there is no way to use constrained resources optimally
C) A linear programming analysis that optimizes the contribution margin per constrained resource
D) Rank products on contribution margin and pick the product with the highest one

Question

Quizplus · Accepted Answer

A linear programming analysis is needed to optimize the contribution margin per constrained resource. This will help the organization make informed decisions on how to allocate its limited resources among multiple products to maximize its overall profitability. Simply ranking products by contribution margin may not result in the most efficient use of resources.

When an Organization Faces Multiple Constraints for Multiple Products, What