A manufacturing company is considering implementing a new production system for one of its product lines. The company has identified three different options:

Option 1: Invest in advanced automation technology that will significantly reduce labor costs and increase production efficiency. This option requires a high upfront investment but is expected to generate substantial long-term cost savings.

Option 2: Outsource the production to a contract manufacturer. This option eliminates the need for capital investment in machinery and allows the company to focus on its core competencies. However, it may lead to a loss of control over the production process.

Option 3: Stick with the current production system and make incremental improvements. This option requires minimal upfront investment but may result in slower production rates and higher costs compared to the other options.