The Costs and Revenues Associated with Two Alternatives Are Listed

question 112

Multiple Choice

The costs and revenues associated with two alternatives are listed below: Which alternative should be selected based on this information?
$$\begin{array} { | l | r | r | } \hline & \text { Altemative 1 } & \text { Alternative 2 } \\\hline \text { Projected revenue } & \$ 100,000 & \$ 125,000 \\\hline \text { Unit-level costs } & 20,000 & 30,000 \\\hline \text { Batch-level costs } & 20,000 & 25,000 \\\hline \text { Product-level costs } & 15,000 & 15,000 \\\hline \text { Facility-level costs } & 10,000 & 10,000 \\\hline\end{array}$$

• A)Alternative 2 because it has a higher profit.
• B)Alternative 2 because it has the same product- & facility-level costs.
• C)Alternative 1 because it has fewer unit-level costs.
• D)Alternative 1 because it has a higher profit.

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