The first few things that I thought of when trying to figure out what portions will be allocated between these two plants was: the size of the plants themselves, and other things like the differences in them, what machines and labor do they have or require, and if any of the machines are different, does this mean they will cost more to run or are they older and slower maybe? Of course our main goal here is to produce all 10,000 pairs of shoes, while minimizing costs altogether, so we must figure out how we will do this. The book mentions things like rent, and wages but I do not really think rent comes into play too much because regardless of how many shoes are being manufactured, it still must be paid and the price will not fluctuate with different output although making the most that they can would be the ideal thing to do. I would assume that the cost of materials would be the same for both plants but could be wrong I suppose. In chapter 7 we learn that the cost of production is calculated by getting the total of all of the costs and dividing by the unit of production. It is useful to calculate a number of parts of the cost of production. Doing this helps understand where the biggest costs are, how much of the costs are input or growing costs and how much are the capital costs. Knowing and understanding your cost of production is an essential element of running a successful business. This case study should help us to demonstrate how to calculate the cost of production and how to use that knowledge to help make sound financial decisions, in the short-term and in the long-term. The plant may also look into any opportunity cost associated with the firm’s resources, economic costs and sunk costs, if any. One of the main factors as well are the fixed and variable costs associated with making the shoes. If able to assess all of what I have mentioned properly,