Consider the three processes described below, which are being evaluated as possible choices to handle the production of units for the firm BGF Associates.

Process	Fixed Cost ($)	Variable Cost ($)
B	4000	22
G	2850	25
F	4500	18

a) Construct a crossover chart to show the comparative total costs of each process, as a function of the volume x of units produced.  Your graph should be neat, complete, reasonably scaled, and clearly labeled with all relevant information. 

 

b)  In your words, give a summary of which process is best (lowest cost) for which volumes.

 

Please give a detailed explanation of each step. What were the calculations required to find the crossover points for the graph? Are there any crossover points between BGF that were discarded? Why? If the best crossover point is between G and F, why is it better than the others? And what are the others?