Elucidate at what production quantity ?these two invest

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Reference no: EM1354642

A brewery is considering two potential production investments.

Option A costs an initial $2 million and will involve constant marginal cost of $5
Option B costs an initial $4 million and will involve constant marginal cost of $3

In order to make the calculations simple, assume that the yearly capital cost is 10% of the total investment. At what production quantity ?these two investment are opportunities?

Reference no: EM1354642

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