Great Canadian Muffin Company, Inc., prepares frozen gourmet muffins for shipment to upscalegrocery stores as well as mailing to web and catalog customers. The company has two workstations,cooking and distribution. The cooking station is limited by the cooking time of the food. Distribution islimited by the speed of the workers. Distribution normally waits on food from cooking. Because thedemand has increased in recent months to 4,000 dozen muffins, management is considering addinganother oven in the cooking station or else having the cooks start to work earlier. The monthly cost ofoperating the cooking station one more hour each day is $1,500. The cost of adding another cookingstation would add an average of $8 per hour. The current operating hours total eight hours a day, 24days a month. The contribution margin of the finished products is currently $2 per dozen. Inventorycarrying costs average $0.50 per dozen per month. Either the extra hour or the new cooking stationwould increase production by 50 dozen a day, with a long-run increase of 100 dozen units in finishedgoods inventory to 500 dozen.

b) What is the increase in the expected monthly product contribution for each of the possible changes? Assume long-run production equals sales.