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a product is currently made in a process focused shop, where fixed costs are 9,000$ per year and variable costs are $50 per unit. the firm is...

a product is currently made in a process focused shop, where fixed costs are 9,000$ per year and variable costs are $50 per unit. the firm is considering a shift in process. the new process would have fixed costs of $90,000 and variable costs of $5. what is the cross over point for these procedures? for what range of outputs is each process appropriate?
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Hi, Please find the... View the full answer

8437670.xlsx

SOLUTION
Cross Over Point (Q )
QAtoB = (FCA - FCB)/(CMA - CMB) From Old Process to New Process
Old Process
New Process
Fixed cost
$9,000
$90,000
Variable Cost
$50
$5
Cross Over Point 1800 units...

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