Question: A product is currently made in a process - focused shop, where fixed costs are $ 9 , 0 0 0 per year and variable
A product is currently made in a processfocused shop, where fixed costs are $ per year and variable cost is $ per unit. The firm is considering a fundamental shift in process, to repetitive manufacture. The new process would have fixed costs of $ and variable costs of $ For what range of outputs is each process appropriate?
Question options:
For volumes over the process focus is cheaper; for volumes under units, the repetitive focus is cheaper.
The repetitive focus is always cheaper.
For volumes under the process focus is cheaper; for volumes over units, the repetitive focus is cheaper.
The process focus is always cheaper
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