Your insurance firm processes claims through its two facilities: facility A and facility B. Each month, facility A handles 6,000 claims and incurs in $120,000 fixed costs and $108,000 in variable costs. Each month, facility B handles 8,000 and incurs $41,000 in fixed costs and $80,000 in variable costs. Hint: Be careful not to commit the sunk-cost fallacy in your analysis. If you anticipate a moderate decrease in the number of claims, you should lay off workers in facility in order to decrease costs. Grade It Now Save & Continue