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Division X Makes a Part with the Following Characteristics

question 52

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Division X makes a part with the following characteristics: Division X makes a part with the following characteristics:   Division Y of the same company would like to purchase 10,000 units each period from Division X.Division Y now purchases the part from an outside supplier at a price of $17 each.Suppose Division X has ample excess capacity to handle all of Division Y's needs without any increase in fixed costs and without cutting into sales to outside customers.If Division X refuses to accept the $17 price internally and Division Y continues to buy from the outside supplier,the company as a whole will be: A) worse off by $70,000 each period. B) better off by $10,000 each period. C) worse off by $60,000 each period. D) worse off by $20,000 each period. E) better off by $60,000 each period. Division Y of the same company would like to purchase 10,000 units each period from Division X.Division Y now purchases the part from an outside supplier at a price of $17 each.Suppose Division X has ample excess capacity to handle all of Division Y's needs without any increase in fixed costs and without cutting into sales to outside customers.If Division X refuses to accept the $17 price internally and Division Y continues to buy from the outside supplier,the company as a whole will be:

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Definitions:

Tay-Sachs Allele

An allele that causes Tay-Sachs disease, a genetic disorder that results in the destruction of nerve cells in the brain and spinal cord, leading to early childhood death.

Ashkenazi Jews

A Jewish ethnic group that has its origins in the medieval Jewish communities of the Rhineland in Western Germany.

Urban Interdependence

The mutual reliance between urban areas, where cities are dependent on each other for resources, economic opportunities, and services.

Warfare

Engaging in or the activities involved in war or conflict.

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