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The Electric Sheep Division of Block C Enterprises is considering the purchase of a new, high quality coating machine for processing end effectors. Two machines are under discussion. Machine A has a purchase price of $400000 and a unit coating cost of $7.50. Machine B has a purchase price of $800000 and a unit coating cost of $1.20. The current value added for the items to be produced on these machines is $10. Both machines have an expected life of 5 years with no salvage value. Determine the annual volume for the breakeven point between the two machines (i.e., where the two machines have the same annual cost)?

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Operation Management, Management Studies

Category:- Operation Management
Reference No.:- M92604846

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