Archer currently manufactures a subcomponent that is used in its main product.A supplier has offered to supply all the subcomponents needed at a price of $42.Archer currently produces 100,000 subcomponents at the following manufacturing costs:
a.If Archer has no alternative uses for the manufacturing capacity,what would be the profit impact of buying the subcomponents from the supplier?
b.If Archer has no alternative uses for the manufacturing capacity,what would be the maximum price per unit they would be willing to pay the supplier?
c.Now assume Archer would avoid $150,000 in equipment leases and salaries if the subcomponent were purchased from the supplier.Now what would be the profit impact of buying from the supplier?
Definitions:
P-chart
A type of control chart used in statistical quality control to monitor the proportion of defective items in a process over time.
Minimum Sample Size
The smallest quantity of data required to achieve a certain level of reliability or precision in statistical analysis.
Samples
A subset of a population selected for measurement, observation, or questioning to provide statistical information about the whole.
Standard Deviation
Standard Deviation is a statistic that measures the dispersion or variability of a dataset relative to its mean, indicating how spread out the data points are.
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