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Business, 03.08.2020 09:01 wegannet5

processes organic milk into plain yogurt. sells plain yogurt to hospitals, nursing homes, and restaurants in bulk, one-gallon containers. Each batch, processed at a cost of , yields gallons of plain yogurt. The company sells the one-gallon tubs for each and spends for each plastic tub. has recently begun to reconsider its strategy. Management wonders if it would be more profitable to sell individual-sized portions of fruited organic yogurt at local food stores. could further process each batch of plain yogurt into individual portions (3/4 cup each) of fruited yogurt. A recent market analysis indicates that demand for the product exists. would sell each individual portion for . Packaging would cost per portion, and fruit would cost per portion. Fixed costs would not change. Should continue to sell only the gallon-sized plain yogurt (sell as is) or convert the plain yogurt into individual-sized portions of fruited yogurt (process further)? Why?

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