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 The manager of a car wash must decide whether to have one or two wash lines. One line will mean a fixed cost of $6,000 a month, and two lines will mean a fixed cost of $10, 500 a month. Each line would be able to process 15 cars an hour. Variable costs will be $3 per car, and revenue will be $5.95 per car. The manager projects an average demand of between 14 and 18 cars an hour. Would you recommend one or two lines? The car wash is open 300 hours a month.

Operation Management, Management Studies

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