George's Dry Cleaning is considering a merger with Weezzie's Laundry Supply Stores.George's total operating costs of producing services are $590,000 for sales volume (S_G)of $4.7 million.Weezzie's total operating costs of producing services are $152,000 for a sales volume (S_W)of $2.3 million.For a sales volume of $7 million,calculate the reduction in production costs the merged firms need to experience such that the total average cost (TAC)for the merged firms is equal to 9 percent.

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The Answer of George's Dry Cleaning is considering a merger with Weezzie's Laundry Supply Stores.George's total operating costs of producing services are $590,000 for sales volume (S_G)of $4.7 million.Weezzie's total operating costs of producing services are $152,000 for a sales volume (S_W)of $2.3 million.For a sales volume of $7 million,calculate the reduction in production costs the merged firms need to experience such that the total average cost (TAC)for the merged firms is equal to 9 percent.

George's Dry Cleaning Is Considering a Merger with Weezzie's Laundry