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A software company currently uses a traditional server-based system to manage its operations, which incurs significant maintenance costs and requires regular hardware upgrades. The fixed

image text in transcribed A software company currently uses a traditional server-based system to manage its operations, which incurs significant maintenance costs and requires regular hardware upgrades. The fixed costs associated with the server-based system are \$500,000 per year, while the variable costs per user are $150 per year. The company is considering switching to a cloud-based system, which would increase the fixed costs by 25 percent but decrease the variable costs per user by 40 percent. Required If the company expects to have 5000 users next year, should the company switch to the cloud-based system? Justify your

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