Blinds N Such is considering a merger with Window Supply Stores. Blinds' total operating costs of producing services are $750,000 for sales volume of $6 million. Window's total operating costs of producing services are $100,000 for a sales volume (JP) of $1 million. Calculate the average cost of production for the Blinds and Window firms, respectively.
A) 10 percent, 12.5 percent
B) 12.5 percent, 10 percent
C) 75 percent, 1.67 percent
D) 13.93 percent, 13.93 percent

Question

Quizplus · Accepted Answer

The average cost of production for Blinds is $750,000 / $6,000,000 = 12.5 percent. For Window, it is $100,000 / $1,000,000 = 10 percent.

Blinds N Such Is Considering a Merger with Window Supply