In a Make-Or-Buy Decision When There Are Alternative Uses for Capacity

question 92

True/False

In a make-or-buy decision when there are alternative uses for capacity, the opportunity cost of idle capacity is relevant.

---

Definitions:

Ounce

A unit of weight used in some countries, typically equal to one sixteenth of a pound or about 28.35 grams.

Hedge

An investment made to reduce the risk of adverse price movements in an asset, typically involving derivatives like options or futures.

Bushels

A unit of volume that is used to measure agricultural commodities.

Corn

A cereal plant which yields large kernels set in rows on a cob; an important crop for food, livestock feed, and ethanol production.