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A small firm intends to increase the capacity of a bottleneck operation by adding a new machine. Two altematives, A and B, have been identiled,
A small firm intends to increase the capacity of a bottleneck operation by adding a new machine. Two altematives, A and B, have been identiled, and the associated costs and revenues have been estimated. Annual fixed costs would be $36.000 for A and $23,000 for B : vartabie costs per unit would be $10 for A and $11 for B; and revenue per unit would be $16 a. Determine each aiternative's break-even point in units. (Round your answer to the nearest whole omount.) b. At what volume of output would the two olternatives yleld the same profit (or loss? (Round your answer to the nearest whole amount.) c. If expected annuol demand is 11,000 units, which altemative would yleid the higher profit lor the lower loss
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