(Solved):MSU manufactures seats for trains. The company has the capacity to produce 100,000 seats per…

 

Question

MSU manufactures seats for trains. The company has the capacity to produce 100,000 seats per year, but is currently producing and selling 75,000 seats per year.

The following information relates to current production:

Sale price per unit $400
Variable costs per unit:
Manufacturing $220
Marketing and administrative $50
Total fixed costs:
Manufacturing $750,000
Marketing and administrative $200,000

If a

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