Product constraint decisions

In 100 words or more reply to statement below about Product constraint decisions

As a manager it’s important to maximize profits. However, there may be market and/or production constraints as to how much of a product you can produce. If you produce four products in your factory, you need to evaluate the contribution margin for each product, as well your production capacity. If you are able to increase profits by devoting all production resources to one product then that would be the prudent choice. Market factors are also a consideration since you may not sustain the same level of demand if you oversaturate the market with your product.

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