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

question 143

Multiple Choice

Use the information below to answer the following question(s) :
Cruise Company produces a part that is used in the manufacture of one of its products. The unit manufacturing costs of this part, assuming a production level of 6,000 units, are as follows:

-Assuming Cruise Company can purchase 6,000 units of the part from Suri Company for $14 each, and the facilities currently used to make the part could be rented out to another manufacturer for $24,000 a year, what should Cruise Company do?

• A) Make the part and save $6.00 per unit.
• B) Make the part and save $2.00 per unit.
• C) Buy the part and save $2.00 per unit.
• D) Buy the part and save $1.00 per unit.

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Definitions:

Graphically

In a manner pertaining to the visual representation of data, equations, or functions on a coordinate system.

Intercept

A point where a line, curve, or surface intersects a coordinate axis.

Absolute Value

The absolute value of a number is its distance from zero on the number line, without considering which direction from zero the number lies, always yielding a non-negative result.

Sketch Graph

The act of drawing a rough outline or diagram of a graph, typically to illustrate behavior or solutions.