ABC is a small firm that assembles and sells custom computers. Current financials for the firm are given below. It considers three alternatives to improve its financials. In the first option, marketing will increase sales (and costs) by 50%. The next option is to change the supplier which would result in a 12% decrease in the cost of inputs. Finally, there is an OM option, which would reduce production costs by 25%.

Which of the options would you recommend to the firm if it can only pursue one option?

In addition, comment on the feasibility of each option. (12)

Business Function Current Value

Cost of Inputs $50,000

Production Costs $30,000

Revenue $83,000