Question: C&A uses two steps to make a toy. Step 1 takes 20 seconds. Step 2 takes 15 seconds. Each step is staffed by one worker,

C&A uses two steps to make a toy. Step 1 takes 20 seconds. Step 2 takes 15 seconds. Each step is staffed by one worker, for a total of two workers. Each worker is paid $15 per hour. Each toy is sold for $20. Material costs are $5 per toy and fixed costs are $500 per hour. Assume demand is unlimited. Answer the following questions. a. How much profit does C&A make per hour? b. What will be the impact on C&As profit per hour if the processing time of step 2 is reduced to 10 seconds? c. Demand rate is 120 toys per hour. How much profit does C&A make per hour? Assume the worker's pay is a variable cost.

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