Scenario 2.6 You Currently Purchase a Part Used in Your Production Process

question 141

Multiple Choice

Scenario 2.6
You currently purchase a part used in your production process from an outside supplier, and have decided to begin making this part in-house. You have two equipment options for moving production in-house: special-purpose equipment and general-purpose equipment. Cost information for these two options is as follows:

-Use Scenario 2.6 to answer this question. For what range of output is the Special-Purpose Equipment the low-cost option?

• A) 30,000 or more units per year
• B) 0 - 30,000 units per year
• C) 0 - 40,000 units per year
• D) 40,000 or more units per year

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Definitions:

Locus Of Causality

Attribution of behavior to either an aspect of the actor (internal) or to some aspect of the situation (external).

Stability

The condition of being resistant to change and not easily upset or disturbed.

Internality

The belief in one's ability to control events and outcomes in their own life, often associated with a proactive mindset.

Externality

A term in economics where a cost or benefit that affects a party who did not choose to incur that cost or benefit.