Use This Scenario to Answer the Following Questions

question 103

Multiple Choice

Use this scenario to answer the following questions.
A company must decide if it will make or buy an item it needs. The company can make the item for $10 per unit, but must invest $15,000 in tooling to achieve that capability. Alex Rogo has quoted a total price of $12 per unit to supply the quantity required (assume their fixed costs are included in the quoted price) .
-Refer to the instruction above. What is the break-even quantity in this situation?

• A) 6,500 units
• B) 7,000 units
• C) 7,250 units
• D) 7,500 units

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Definitions:

Truck's Engine

The power unit of a truck, designed to convert fuel into mechanical energy to move the vehicle.

Mechanic's Job

A position involving the repair and maintenance of machinery, vehicles, or other mechanical equipment.

Ethnic Identities

Aspects of individuals' self-concepts based on their membership in ethnic groups, including a sense of belonging, shared culture, and heritage.

Majority Culture

The dominant cultural group in a society, whose beliefs, values, and practices are most widely accepted and influence societal norms.