JTM Ltd incurs costs of $16 per unit ($12 variable, $4 fixed) for a widget it sells for $22. JTM has received two special offers: Firm A wants 10,000 units and Firm B wants 14,000 units. Both firms will sell the widgets for $17, and JTM has capacity to produce 12,000 additional units. From a cost perspective, what is the main difference between these two offers?
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Home » Business » JTM Ltd incurs costs of $16 per unit ($12 variable, $4 fixed) for a widget it sells for $22. JTM has received two special offers: Firm A wants 10,000 units and Firm B wants 14,000 units.