A Firm Must Make a Choice Between a Manual and a Semi-Automatic

question 18

Multiple Choice

A firm must make a choice between a manual and a semi-automatic production process for a new product line. The following are the costs for each process: $\begin{array}{|l|c|c|}\hline \text { Alternative } & \text { Fixed Cost } & \text { Variable Cost } \\\hline \text { Manual } & \$ 100,000 & \$ 75.00 \\\hline \text { Semi-Automatic } & \$ 300,000 & \$ 50.00 \\\hline\end{array}$ The breakeven volume is _____.

• A) less than or equal to 2000 units
• B) more than 2000 but less than or equal to 4000 units
• C) more than 4000 but less than or equal to 6000 units
• D) more than 6000 but less than or equal to 8000 units

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Definitions:

Communication

The process of exchanging information and ideas between individuals or entities, often involving speaking, writing, or using other mediums.

Legitimate Power

The authority derived from a formal position or role in an organization, which allows someone to influence others.

Supplier

A supplier is an entity that provides goods or services to another organization, playing a crucial role in the supply chain by influencing product quality, costing, and availability.

Walmart

An American multinational retail corporation that operates a chain of hypermarkets, discount department stores, and grocery stores.