6. Process A has a fixed cost of $175,000 per year and a variable cost of $41.00 per unit. For Process B, 10 units can be produced in 1 day at a cost of $220.0. If the company's MARR is 10% per year, what will the annual fixed cost have to be for Process B in order for the two alternatives to have the same annual total cost at a production rate of 6,250 units per year?

6. Process A has a fixed cost of $175,000 per year and a variable cost of $41.00 per unit. For Process B, 10 units can be produced in 1 day at a cost of $220.0. If the company's MARR is 10% per year, what will the annual fixed cost have to be for Process B in order for the two alternatives to have the same annual total cost at a production rate of 6,250 units per year?

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter8: Cost Analysis

Section: Chapter Questions

Problem 1.1CE

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