Bovee Company Manufactures a Part for Its Production Cycle

question 93

Multiple Choice

Bovee Company manufactures a part for its production cycle. The costs per unit for 10,000 units of this part are as follows:
The fixed factory overhead costs are unavoidable.
-Clarke Company has offered to sell 10,000 units of the same part to Bovee for $104 a unit. Assuming no other use for the facilities, Bovee should

• A) make the part as this would save $8 per unit.
• B) buy from Clarke as this would save $20 per unit.
• C) make the part as this would save $20 per unit
• D) buy from Clarke as this would save $8 per unit.

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Definitions:

Five-Year Plan

Economic programs implemented by Soviet Union to industrialize rapidly and increase production, usually focusing on heavy industry and agriculture.

Soviet Agriculture

Soviet agriculture refers to the farming practices and policies in the Soviet Union, characterized by collective farming, state ownership of land, and efforts to increase food production under communist ideologies.

Nuremberg Laws

A set of antisemitic laws in Nazi Germany introduced in 1935, which severely restricted the rights of Jewish people.

Citizenship

The status of being a recognized member of a state or nation, with rights and duties as defined by law.