Multiple choice

A component can be produced by any of the four processes I, II, III and IV. Process I has a fixed cost of Rs. 20 and variable cost of Rs. 3 per piece. Process II has a fixed cost of Rs.50 and variable cost of Re. 1 per piece. Process III has a fixed cost of Rs. 40 and variable cost of Rs. 2 per piece. Process IV has a fixed cost of Rs.10 and variable cost of Rs. 4 per piece. If the company wishes to produce 100 pieces of the component, from economic point of view it should choose

  1. Process I

  2. Process II

  3. Process III

  4. Process IV

Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation