The selling price of a product is set at 30 the firm can, Ask an Expert

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The selling price of a product is set at $30. The firm can outsource the production and pay $25 per unit. Alternatively, the firm can invest in assembly line X and Y and produce the product on its own. Assembly line X requires a fixed cost of $270,000 and assembly line Y requires a fixed cost of $450,000. The unit variable cost will be $18 with assembly X and $12 with assembly line Y.

What is the break-even demand for assembly line X?

Assembly line X should never be chosen. A. True B. False

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Operation Management, Management Studies

Category:- Operation Management
Reference No.:- M93132168

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