M/s Bhagya & Co. is currently engaged in the manufacture and sale of a product EC. Its budget for the next year reveals the following:
| Selling price/unit Don't use plagiarized sources. Get Your Custom Essay on you are required to suggest whether a diversification is advisable 608764 Get an essay WRITTEN FOR YOU, Plagiarism free, and by an EXPERT! Just from $10/Page | : Rs. 15 |
| Variable cost/unit | : Rs. 10 |
| Fixed cost | : Rs. 50,000 |
| Demand | : 25,000 units |
It wants to diversity into product OK in order to reduce its market risks, and following are the estimated data for the new product OK.
| Selling price/unit | : Rs. 18 |
| Variable cost/unit | : Rs. 12 |
| Fixed cost | : Rs. 30,000 |
| Demand | : 10,000 units. |
You are required to suggest whether a diversification is advisable?
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