Consider both sides of the argument

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Reference no: EM13159164

At a recent meeting, the president and the CEO of Production, Inc. got into a heated argument about whether or not to shut down the company%u2019s plant in Flint, Michigan. The plant currently loses $50,000/month. The president of Production, Inc. argued that the plant should continue to operate until a buyer is found for the facility. This argument was based on the fact that the plant%u2019s fixed costs are $61,000/month. The CEO disagreed over this point, arguing that fixed costs do not matter in making the shutdown decision.

Consider both sides of the argument and come to a decision of whether to close the plant or continue to operate it. How would you explain to either the president or the CEO that he or she is wrong?

Reference no: EM13159164

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