Question $3$

The process used by the Gourmet Faod Company $($Process $1)$ to produce dressings has

annual fixed casts of $$240,000$ and variable costs of $$0\mathrm{.}50$ per bottle. The company just

entered into an agreement with a majar national grocery store chain to sell its dressings.

Sales volumes are expected to increase. Twa new processes are being explored. Process $2$

has a fixed cost of $$320,000$ per year and variable costs of $$\mathrm{.}30$ per bottle. Process $3$ has

fixed costs of $$400,000$ per year and variable costs of $$\mathrm{.}25$ per bottle.

If sales are expected to be $300,000$ battles, which process should be used?

Process $1$

Process $2$

Process $3$