Help, Operations Management challenge question?
February 18th, 2010 | 
Author: Matty asked:
I have tried so much trying to solve this question, but obviously I gave up and need some help.
“BeGood corporation designs and manufactures products that make the world a better place. They recently designed a new product and are making process choices for its manufacture. Choice A involves utilizing their current work force with a minor investment in equipment. This investment would be $50,000 and would require another $85 in labor per unit. Choice B involves an investment of $950,000 in new equipment, and would require another $25 in labor per unit.
required:
(a)- which choice would be most appropriate if BeGood sells 2500 units? Why?
(b)- which choice would be most appropriate if BeGood sells 1000 units? Why?
(c)- at what volume would BeGood be indefferent to the process choice?
(d)- in the context of your answer to part (c), what other factors that BeGood should be considering?”
