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Consider a distribution center with a full volume capacity of 1 million cartons (or units) processed per year, a variable cost per carton processed of
Consider a distribution center with a full volume capacity of 1 million cartons (or units) processed per year, a variable cost per carton processed of $5, and a fixed facility cost of $50,000,000 per year. Assume a scale factor of 70% and a capacity utilization of 100%. What would the fixed cost per unit for this facility be if the full volume capacity were to increase to 2 million cartons processed per year? Please choose only one option
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