About the fixed costs-variable costs

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Process A has fixed costs of $2000 and variable costs of $40 per unit. Process B has fixed costs of $5000 and variable costs of $30 per unit. Which of the following statements is true?

The indifference point between process A and process B is approximately 300 units

It is impossible for one process to have both of its costs lower than those of another process

Process A is cheaper than process B at all volumes

Process B is cheaper than process A at all volumes

Process B is more profitable than process A and should be selected

Reference no: EM13785904

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