Multiplex Cinema owns and operates a nationwide chain of movie theatres. The 500 properties in the Multiplex chain vary from low-volume, small-town, single-screen theatres to high-volume, bigcity, multiscreen theatres.
The management is considering installing machines that will make popcorn on the premises. These machines would allow the theatres to sell popcorn that would be freshly popped daily rather than the prepopped corn that is currently purchased in large bags. This proposed feature would be properly advertised and is intended to increase patronage at the company’s theatres.
The machines can be purchased in several different sizes. The annual rental costs and the operating costs vary with the size of the machines. The machine a capacities and costs are 

1. Calculate the volume level in boxes at which the Economy Popper and Regular Popper would earn the same operating profit (loss). 

2. The management can estimate the number of boxes to be sold at each of its theatres. Present a decision rule that would enable Multiplex's management to select the most profitable machine without having to make a separate cost calculation for each theatre. That is, at what anticipated range of unit sales should the Economy model be used? The Regular model? The Super model?

3. Could the management use the average number of boxes sold per seat for the entire chain and the capacity of each theatre to develop this decision rule? Explain your answer.

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Annual capacity Costs: Economy POPPER MODEL Regular Super 50,000 boxes 120,000 boxes 300,000 boxes Annual machine rental $8,000 $11,200 $20,200 Popcorn cost per box 0.14 0.14 0.14 Cost of each box 0.09 0.09 0.09 Other variable costs per box 0.22 0.14 0.05