Suppose that a manufacturer can produce a part for $11.00 with a fixed cost of $6,000. Alternately, the manufacturer could contract with a supplier in Asia to purchase the part at a cost of $12.00, which includes transportation. a. If the anticipated production volume is 1,400 units, compute the total cost of manufacturing and the total cost of outsourcing. b. What is the best decision?

Suppose that a manufacturer can produce a part for $11.00 with a fixed cost of $6,000. Alternately, the manufacturer could contract with a supplier in Asia to purchase the part at a cost of $12.00, which includes transportation. a. If the anticipated production volume is 1,400 units, compute the total cost of manufacturing and the total cost of outsourcing. b. What is the best decision?

Intermediate Algebra

19th Edition

ISBN:9780998625720

Author:Lynn Marecek

Publisher:Lynn Marecek

Chapter12: Sequences, Series And Binomial Theorem

Section12.3: Geometric Sequences And Series

Problem 12.58TI: What is the total effect on the economy of a government tax rebate of $500 to each household in...

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Part 1

Suppose that a manufacturer can produce a part for

$11.00

with a fixed cost of

$6,000.

Alternately, the manufacturer could contract with a supplier in Asia to purchase the part at a cost of

$12.00,

which includes transportation.

a. If the anticipated production volume is

1,400

units, compute the total cost of manufacturing and the total cost of outsourcing.

b. What is the best decision?

Question content area bottom

Part 1

a. The total cost of manufacturing is

(Simplify your answer.)

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