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You are the owner of a small firm with fixed costs of $10,000. The variable cost per unit of your only product is $10. An
You are the owner of a small firm with fixed costs of $10,000. The variable cost per unit of your only product is $10. An industrial salesperson just visited your office trying to sell you a machine that would increase your fixed costs by $11,000 (to $21,000) and would reduce your variable cost per unit to $8. You are able to sell your product for $15 per unit. After what level of unit sales does the new, more automated, production model outperform the status quo
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