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Produce the same product

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Reference no: EM131220091

Suppose you are a consultant to a firm that has two production facilities (A and B), both of which produce the same product.  An accountant provides you with the following cost data:

QA,000             QB,000

TCA=$900,000       TCB=$570,000

ATCA=$22.50        ATCB=$19.00

MCA=$8.00                        MCB=$12.00

Given these data, how, if at all, would you recommend reallocating production between these two plants?  Briefly explain why. 

Reference no: EM131220091

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