Answer:
A.C. Tech Manufacturing Appliances
Product Models to produce first, if management incorporates a short-run profit-maximizing strategy:
                                                  Small      Medium     Large
Selling price                             $430       $610          $1,210
Variable cost                            $270       $280         $530
Contribution                            $160        $330         $680
Fixed Costs:
Fixed manufacturing                 $40         $170          $270
Fixed selling & admin                $70         $75            $140
Unit Profit                                   $50         $85            $270
Demand in units                         150         170              150
Total profit                               $7,500     $14,450      $40,500
Machine hours/unit                     60           60             150
Total machine hours required 9,000      10,200        22,500
Unit profit per machine hour   $0.83      $1.42         $1.80
If management incorporates a short-run profit maximizing strategy, given maximum machine hours available, it should first produce the large model.
Explanation:
The large model offers better contribution per unit, better profit per unit and in total, and most importantly better profit per unit of hour (major constraint).
In making a limiting factor decision, the choice goes to the product model that produces more profit under the limiting constraint.