Respond Part B in details and show your step by step answer!
1) cost of production = $(100000+40*10000)
cost/parts = total cost/10000 = $50
Now, considering defects parts cost
since each defective parts needs to be replaced with cost of $120
so, total cost = 228000
adding this to cost of production, we get
Production cost/parts= 728000/10000= $72.8
Market value /parts = $72
Thus its economically better to buy the component
B)
1)economic feasibility depends upon the return on investment(roi) which is given by
ROI = Present Value Of Benefits / Present Value Of Costs
if the roi is higher,more the process is economical feasible and vice versa
i think in this case it is not economically feasible because the value of cost is higher than the benefits range
2)yes the probability of defects will change as it depends upon the number of products.so as it increases the probabilty increases.
3)yes the economic feasibility could change ina positive way if the contract goes bigger as their is more chance of getting higher rate of return on each component.so it will change.
Respond Part B in details and show your step by step answer! TELOXY ENGINEERING (A) Teloxy...
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