Posted: February 5th, 2016

Find the range of output for each alternative that would yield the lowest total cost. (Leave no cells blank – be certain to enter “0” wherever required. Round your answers to the nearest whole number.)

A company that produces pleasure boats has decided to expand one of its lines. Current facilities are insufficient to handle the increased workload, so the company is considering three alternatives. A (new location), B (subcontract), and C (expand existing facilities).

Alternative A would involve substantial fixed costs but relatively low variable costs: fixed costs would be $300,000 per year, and variable costs would be $570 per boat. Subcontracting would involve a cost per boat of $2550, and expansion would require an annual fixed cost of $61,000 and a variable cost of $1,070 per boat.

a. Find the range of output for each alternative that would yield the lowest total cost. (Leave no cells blank – be certain to enter “0” wherever required. Round your answers to the nearest whole number.)

A. ______ or more.
B. ______ to _____.
C. ______ to _____. …….I found the answers but not sure what formula I need to work to get these? Please help, I need to know how to work this!

Here are the answers
A. 478 or more
B. 0 to 41
C. 44 to 478