Question

A company is considering the purchase of a piece of equipment to be used to manufacture a new product. Four machines are being considered. The following table summa
rizes the purchase cost of each machine and the associated variable cost of production
ifthe machine is used to produce the new product. Determine the ranges of output over
which each machine would be the least costly alternative Sketch the four cost func-
tions
Purchase cost
Variable Cost/Unit
Machine1多80,000
1000
Machine 2
120,000
Machine 3
Machine 4
00

Answer 1

Answer:

third and fourth machine is off rupees 201 0 0 0