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Q1: MEC Corporation is running below its operating capacity and charges $28 per unit. To use some of the excess capacity and generate additional sales,
Q1: MEC Corporation is running below its operating capacity and charges $28 per unit. To use some of the excess capacity and generate additional sales, they are looking at 2 special offers from customers. Customer A is offering to purchase purchase 1000 units at $24 each. Customer B is offering to purchase 1000 units at $25 each. Variable costs are $17 per unit and no additional fixed costs would be added with either order. Which special offer, if any, should be accepted (we cannot do both orders) and why? Option A Option B Decision
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