Use the Information Below to Answer the Following Question(s)

question 233

Multiple Choice

Use the information below to answer the following question(s) :
Star Appliance manufactures a variety of appliances which all use Part 92F. Currently, Star Appliance manufactures Part 92F itself. It has been producing 8,000 units of Part 92F annually. The annual costs of producing Part 92F at the level of 8,000 units include:

All of the fixed manufacturing overhead costs would continue whether Part 92F is made internally or purchased from an outside supplier. Star Appliance has no alternative use for the manufacturing facilities.
-Roger Parts Company has offered to sell 8,000 units of Part 92F to Star Appliance for $22.00 per unit. What should Star Appliance do?

• A) Make the part and save $4 per unit.
• B) Make the part and save $1 per unit.
• C) Buy from Roger Parts Company and lose $1 per unit.
• D) Make the part and save $3 per unit.

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Definitions:

Trademark Law Revision Act

Legislation that amended existing trademark laws to provide better protection and enforcement mechanisms for trademark owners.

Significant Improvements

Major enhancements or upgrades to products, services, processes, or systems that markedly improve performance or value.

Coca-Cola

A multinational beverage corporation best known for its flagship carbonated soft drink, Coca-Cola.

Trademark

An emblem, expression, or sequence of words legally recognized or adopted through practice to symbolize a firm or merchandise.