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2)Answer in above picture
1)opportunity cost to Wild Orchid of producing the 3,500 units of Stronglast is the contribution margin lost on the 3,500 units of Everlast that would have to be forgone, as computed below:
selling price - variable costs = contribution margin
52-(10+2+8+4) = 28
Contribution margin for 3,500 units = 3500 * 28 = 98000
The opportunity cost is $98,000. Opportunity cost is the maximum contribution to operating income that is forgone (rejected) by not using a lim¬ited resource in its next-best alternative use.
Question 1. (25 marks) The Wild Orchid Corporation is working at full production capacity producing 13,000...
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