Washburn Guitars Recently Purchased Parker Guitar, Another Guitar Manufacturer That

Multiple Choice

Washburn Guitars recently purchased Parker Guitar, another guitar manufacturer that designs products for professionals and collectors, and will combine the two production facilities into a new location. Washburn expects the acquisition to reduce its rent and tax expenses by 40 percent, and the new skilled employees will reduce the hours of work needed for each unit by 15 percent. This would cause the slope of the total cost curve to ________ and the break-even quantity to

A) decrease; stay the same.
B) decrease; increase.
C) increase; increase.
D) stay the same; increase.
E) decrease; decrease.