Karla's Candle Factory Is Considering Two Different Manufacturing Options

question 20

Essay

Karla's candle factory is considering two different manufacturing options.Option A is highly automated with fixed costs of $25,000 and variable costs of $.1/candle.Option B uses hand labor with fixed costs of $10,000 and variable costs of $.5/candle.If demand for Karla's candles is 25,000,which option should she pick?

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Definitions:

Unconditioned Response

A natural, automatic reaction to a stimulus that occurs without prior conditioning or learning.

Classical Conditioning

A learning process that occurs through associations between an environmental stimulus and a naturally occurring stimulus, first described by Ivan Pavlov.

Loud Noise

High decibel sounds that can range from causing mild discomfort to potentially harming hearing health.

Prevalence

The proportion of a population found to have a certain condition or characteristic at a specific time.