Estimate reasonable cost estimate

Reference no: EM13118946

Production costs for a large number of previous orders of varying sizes for a product are in tha attached file. An analyst computes the production cost per unit in each order and averages these to get $50. Using this he gives a cost estimate of $24,000 for a new order for 500 units. Is this a reasonable cost estimate? Explain why or why not. Looking at the data on file, can you give a better cost estimate?

Reference no: EM13118946

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