Big John's Manufacturing currently produces its lead product on a machine that has a variable cost of $3.50 per unit, and fixed costs of $62,000. Big John is considering purchasing a new machine that would drop the variable cost to $1.90 per unit, but has fixed costs of $150,000. What is the crossover point between the two machines?

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The Answer of Big John's Manufacturing currently produces its lead product on a machine that has a variable cost of $3.50 per unit, and fixed costs of $62,000. Big John is considering purchasing a new machine that would drop the variable cost to $1.90 per unit, but has fixed costs of $150,000. What is the crossover point between the two machines?

Big John's Manufacturing Currently Produces Its Lead Product on a Machine