Answer)

The firm/business I am going to discuss is a luxury spa and salon chain which has its own salon spaces and employees a large number of stylists along with management team(marketing,human resources,training etc.),products are various services such as haircuts,different types of spa,facials etc. along with selling of various related products,now when we talk about production process for services,training through experts for different services,for products,production process is by combining different resources for making products,fixed costs are salaries of management and other employees,cost of electricity and other facilities(administrative costs),while variable costs are incentives based on performance,cost of product used for service(such as facial cream),promotional cost on marketing promotions.An example of sunk cost is the machinery which are specific to operations and cannot be sold as it has company manufcatured logo and parts,so the investnment in it cannot be recovered and it is sunk.