Global Metalworks Can Produce Its Own Hinges for a Weekly

question 64

Essay

Global Metalworks can produce its own hinges for a weekly cost of $96,400 and a cost per hinge of $0.10. Currently an outside supplier is used for a weekly cost of $82,500 and a cost per hinge of $0.24. Current weekly demand is 98,000 units. How much larger must weekly demands grow in order to make insourcing economical?

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Definitions:

Federal Reserve

The central banking system of the United States, responsible for setting monetary policy, regulating banks, maintaining financial stability, and providing banking services.

Board Of Governors

The executive leadership of an institution or organization, such as the Federal Reserve in the United States, responsible for setting policies and overseeing operations.

Industry Life Cycle

Describes the stages of growth and development that an industry goes through from its inception to decline, typically including introduction, growth, maturity, and decline phases.

Relative Decline

A situation where a country, economy, or entity experiences a decrease in its position or condition compared to others.