sir,
I have a bit confused about the optimum point of example 1 in Chapter 6.
From the graph, B is the furthest point from the origin and was proved to presume contribution = $90, then E will be equal to 10 and S will be equal to 15, move further away, then B is the optimum point. When can we assume that the optimum point is C? Should we need to plot another contribution line (with a different slope and angle), then move further to see if it touches point C?
From this part, we need to understand the feasible area where constraints are in place and what is the optimal production plan for maximizing the contribution. Correct?
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4y ago#1There is only going to ever be one optimum mix.
Which of the corners gives the optimum mix depends on the angle of the contribution line and for the optimum mix to be at point C would have needed the angle of the contribution line to be different.
Your last sentence is correct.
Thank you...sir. Mainly depends on the angle of contribution to find the optimum point. :)
4y ago#3Correct :-)
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