Compute Expected Values (L.0.1): Sound Company is considering a make-or-buy alternative. An outside supplier has agreed to sell the materials at a price of $40 per unit. If they produced the unit themselves, the costs of the materials would be as follows:

Required: What is the expected cost per unit if they produce the unit themselves?

Transcribed Image Text:

Cost per Unit Probability $30 .20 35 40 .25 45 .20 50 .10 22229 25