The next 3 questions refer to the following:
A manager in charge of new product development can hire engineers and market researchers. The annual salary of an engineer is $40,000 while a market researcher receives $20,000. The marginal contribution of engineers and market researchers are:
Engineers (E) Market Researchers (R)
Additional Additional
Worker New Products Worker New Products
1st 240 1st 80
2nd 200 2nd 70
3rd 160 3rd 60
4th 100 4th 50
5th 40 5th 40
1. How should a manager with an annual budget of $140,000 allocate this budget in order to maximize the number of new products developed?
2. If the manager has an annual budget of $140,000 and currently is hiring two engineers and three market researchers, then.
3. How should a manager with an annual budget of $240,000 allocate this budget in order to maximize the number of new products developed?