Table 1 shows estimates for Coastline Soap Ltd if it expands its factory.
| Measure | Current factory | Expanded factory |
|---|---|---|
| Monthly capacity | 50,000 bars | 85,000 bars |
| Forecast average cost | £4.80 | £3.90 |
| Forecast demand growth | 45% | |
| Investment cost | £0 | £850,000 |
Using Table 1, assess whether Coastline Soap Ltd should expand its factory.
138 exam-style questions on AQA GCSE Economics 1.4 Production, costs, revenue and profit, covering 1.4.1a Business objectives, 1.4.1b Types of costs and revenue, 1.4.1c Calculating profit, 1.4.1d Profit as an incentive to produce, 1.4.1e Moral and ethical considerations, 1.4.2a Production versus productivity, 1.4.2b Factors and benefits of productivity, 1.4.3a Economies of scale and business behaviour, 1.4.3b Types of economy of scale, and 1.4.3c Diseconomies of scale. Each one has a worked solution and a mark scheme showing where the marks go.