The Ibunez Tool Company has two products: a plain circular saw and a fancy circular saw. The plain circular saw sells for $66 and has a variable cost of $50. The fancy circular saw sells for $100 and has a variable cost of $70.
1. Compute the and ratios for plain and fancy circular saws.
2. The demand is for more units than the company can produce. There are only 20,000 machine-hours of manufacturing capacity available. Two plain circular saws can be produced in the same average time (one hour) needed to produce one fancy circular saw. Compute the total for 20,000 hours for plain circular saws only and for fancy circular saws only.
3. In two or three sentences, state the major lesson of this problem.
