A Factory That Makes a Part Has Significant Idle Capacity

question 21

Multiple Choice

A factory that makes a part has significant idle capacity. The factory's opportunity cost of making this part is equal to:

• A) the variable manufacturing cost per unit.
• B) the fixed manufacturing cost per unit.
• C) the semivariable cost per unit.
• D) the total manufacturing cost per unit.
• E) zero.

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Definitions:

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