Question: The Jazzy Java Company is considering upgrading its espresso machine to reduce the time to make each cup of coffee. The current machine has fixed

The Jazzy Java Company is considering upgrading its espresso machine to reduce the time to make each cup of coffee. The current machine has fixed costs of $3,000 per year and variable costs of $0.75 per cup of coffee. With the new machine, fixed costs increase to $7,000 and variable costs decrease to $0.40 per cup of coffee. On average, the price of coffee is $3.00 per cup. a) What is the indifference point between the two processes? Please do the rounding till the 2nd digit after the decimal point. Jazzy Java part

b) If the forecast is for 12,500 cups of coffee to be sold next year, determine which process should Jazzy Java Company use. What is the total cost then?

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