Ruth Company Produces 1,000 Units of a Necessary Component with the Following

question 52

Multiple Choice

Ruth Company produces 1,000 units of a necessary component with the following costs: Ruth Company could avoid $6,000 in fixed overhead costs if it acquires the components externally. If cost minimization is the major consideration and the company would prefer to buy the components, what is the maximum external price that Ruth Company would accept to acquire the 1,000 units externally?

• A) $58,000
• B) $64,000
• C) $59,000
• D) $62,000

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Definitions:

Service Economy

An economy or sector characterized by the dominance of services over goods, including industries such as retail, healthcare, and information technology.

Jobs

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Advertising that is primarily focused on influencing public opinion or promoting policy changes rather than directly selling a product or service.

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The act of influencing public decision-making through methods other than direct contact with legislators or officials, often involving public campaigns or mobilizing interest groups.