Reference no: EM13663719

Two different manufacturing processes are being considered for making a new product. The first process is less capital-intensive, with fixed costs of only $50,000 per year and variable costs of $700 per unit. The second process has fixed costs of $400,000 but variable costs of only $200 per unit. a) What is the break-even quantity, beyond which the second process becomes more attractive then the first? b) If the expected annual sales for the product is 800 units, which process would you choose?