Value Electronics Uses a Standard Part in the Manufacture of Different

question 167

Multiple Choice

Value Electronics uses a standard part in the manufacture of different types of radios.The total cost of producing 25,000 parts is $95,000,which includes fixed costs of $40,000 and variable costs of $55,000.The company can buy this part from an external supplier for $3 per unit and avoid 20% of the fixed costs.If Value Electronics decides to outsource the production of the part,how will it impact its operating income?

• A)Operating income increases by $12,000.
• B)Operating income decreases by $12,000.
• C)Operating income increases by $20,000.
• D)Operating income decreases by $20,000.

Recognize the distinctions and behaviors between prototypical and peripheral group members.

Identify the effects of representational gaps on team function and perspective alignment.

Understand how consumer choices are influenced by budget constraints.

Analyze production possibilities and constraints within small companies.

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Definitions:

Statistical Technique

A method used in research to analyze data and draw conclusions from it, often involving mathematical theories and models.

L-Data Technique

The L-Data Technique refers to the use of life record data, such as observable behavior and real-world outcomes, in psychological research and assessment.

Real-Life Settings

Environments or situations that occur in the natural course of life, outside of controlled or artificial conditions.

Specific Behaviors

Actions or reactions of an organism or individual, usually in response to the environment, that are distinct and particular.