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A firm is considering three process options for manufacturing a product - two intermittent processes and repetitive process. The smaller intermittent process has fixed costs of $3,000 per month and variable costs of $10 per unit. The larger intermittent process has fixed costs of $12, 000 per month and variable costs of $2 per unit. The repetitive process has fixed costs of $50,000 per month and variable costs of $1 per unit.
Questions:
A) At what output does the large intermittent process become cheaper than the small one?
B) At what output does the repetitive process become cheaper than the larger intermittent process?
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