**Internet of Tea Maker is just the name of the product**

Q4. Sales of Internet of Tea Makers have boomed. So much so that our company now operates two construction plants, one in Australia (plant I), and one overseas (Plant II). Plant I can produce 200,000 Internet of Tea Makers a year, whereas Plant II can produce 600,000 Internet of Tea Makers a year. The annual fixed cost of Plant I is $150,000 per year and the variable cost is $85 per IoT maker. The annual fixed cost of Plant II is $250,000 per year and the variable cost is $45. Plant 1 is being operated at 85% of capacity and Plant 11 is being operated at 60% of capacity. i) What would be the total cost to the company and cost per Internet of Tea Maker if Plant I was operated at full capacity with any remaining demand being satisfied by Plant II? ii) If the total demand for Internet of Tea Makers increased to 700,000 per year, what is the optimum capacity at which Plants I and II should be operated (i.e. to minimise production costs)