The Modern Software Company, Bangalore, fi nds that while it costs Rs. 67.50 each to make a
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The Modern Software Company, Bangalore, fi nds that while it costs Rs. 67.50 each to make a component of Pen-Drive, the same is available in the market at Rs. 57.50 each with the assurance of a continued supply.
The break-down of cost is as follows:
(a) Should you make or buy?
(b) What would be your decision if the supplier offered at Rs. 45.50 each?
Transcribed Image Text:
Rs./Each Materials 27.50 Labour 17.50 Other variable costs 5.00 Fixed cost 12.50
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