In linear breakeven analysis, if process A has a variable cost of $45 per unit and process B has a variable cost of $31 per unit, which alternative would be preferred if the breakeven point is 7400 units and production is expected to be 6200 units? (choose one)
(a)
(b) Process B
(c) Process B if its fixed cost is lower than the fixed cost of Process A
(d) Cannot tell; need more information
Production < breakeven point; select alternative with higher slope
Answer is (a) Process A
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