Answer:
The large application should be produced first by management in order to incorporate short run profit maximizing strategy.
Step-by-step explanation:
In order to maximize profit in the short run by management, we need to calculate the unit profit per machine hour for each appliances. Using the following formulae, as shown below:
Unit Profit / Machine-hours per unit = Unit Profit per Machine hour
Small Application
40 / 20 = $2 per machine hour
Medium Application
115 / 40 = $2.875 per machine hour
Large Application
340 / 100 = $3.4 per machine hour
As per the above calculation the large application gives the highest profit per machine hour so should be produced first. Afterwards if any machine hour is left then medium application should be produced second and finally, small application third.