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Question 2. (30 points) SMG Sound Co. must select a manufacturing process for its new speaker sets, SM-5, from two different process alternatives ( X
Question 2. (30 points) SMG Sound Co. must select a manufacturing process for its new speaker sets, SM-5, from two different process alternatives ( X and Y ). Each speaker set will be sold for $120. The following cost data has been gathered: 1) Find the break-even point for each process alternative. (10 points) 2) Identifying the range of production quantity that each process alternative is the more economic than the other. Show your answer in the graph with two cost lines ( X and Y ). (10 points) 3) If SMG forecasts the demand of SM-5, which is 20,000 sets per year, which method the company should choose for cost minimization? (5 points) 4) If SMG produces and sells 20,000 sets per year using the method that you decide in 3), what is the expected annual profit? ( 5 points)
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