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Pfizer is assessing the costs of producing a new pharmaceutical drug. The fixed production costs are $50,000,000, and the variable costs are $5 per unit.
Pfizer is assessing the costs of producing a new pharmaceutical drug. The fixed production costs are $50,000,000, and the variable costs are $5 per unit. Pfizer expects to produce 10,000,000 units in the first year. Additionally, regulatory approval costs are estimated to be $20,000,000.
Requirements:
- Calculate the total production and regulatory approval costs.
- Determine the cost per unit.
- Analyze the impact of producing an additional 2,000,000 units on total and per-unit costs.
- Discuss the importance of managing regulatory approval costs.
- Recommend strategies for optimizing pharmaceutical production.
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