Manufacturers using computer-integrated manufacturing systems have a large investment in plant and equipment.This results in which of the following cost structures?
A)high fixed costs.
B)high total costs.
C)high variable costs.
D)None of the answers is correct.

Question

Quizplus · Accepted Answer

Computer-integrated manufacturing systems involve significant investments in plant and equipment, which results in higher fixed costs. These fixed costs include the cost of purchasing and installing the equipment, as well as maintaining and repairing it. As a result, the cost structure for manufacturers using computer-integrated manufacturing systems tends to be characterized by higher fixed costs and lower variable costs.

Manufacturers Using Computer-Integrated Manufacturing Systems Have a Large Investment in Plant