Optimum use of scarce resources Flashcards
1
Q
What are scarce resources?
A
Activities or assets that limit output because there is a finite limit to them. e.g materials
2
Q
How to maximise profits regarding scarce resources when selling more than one product?
A
By producing as many as possible of the product with the highest contribution per unit of scarce resource.
3
Q
Contribution per unit of scarce resource =
A
Number of labour hours needed per unit of production
