Edwards Inc

question 98

Essay

Edwards Inc.manufactures electronics.It consists of several divisions operating investment centers.Division A desires to purchase materials from Division B at a price of $85 per unit.Division B can produce 25,000 units at full capacity,and is currently operating at 90% capacity with a variable cost of $80 per unit.Division B currently sells only to outside customers who pay $115 per unit.Division A pays an outside company $110 per unit.If purchased from Division B,B's variable costs would be $10 less because it saves on marketing expenses.Division A requires 10,000 units.
Required: How would Division B selling to Division A affect Division A's purchasing costs? How would intercompany sales affect Division B? What solution would be best for Edwards Inc. ,assuming Division B has the ability to operate at full capacity?

Understand the significance of double-blinding in an experiment.

Recognize the necessity of a control group in experimental research.

Recognize and describe the role of blocking variables in experimental design.

Identify and explain common flaws in experimental design.

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Definitions:

Production Technology

Refers to the methods and processes used in the production of goods and services.

Production Possibilities Curve

A graphical representation showing the maximum combination of goods or services that can be produced in a given period with available resources.

Resources Efficiency

The optimal use and management of resources to maximize their potential and minimize waste or inefficiency, aiming for sustainable and effective utilization.

Production Possibilities

Refers to the various combinations of goods and services an economy can produce, given its available resources and technology.