7.5 Stan Fawcetts company is considering producing a gear assembly that it now purchases from Salt Lake
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• • 7.5 Stan Fawcett’s company is considering producing a gear assembly that it now purchases from Salt Lake Supply, Inc.
Salt Lake Supply charges $4 per unit, with a minimum order of 3,000 units. Stan estimates that it will cost $15,000 to set up the process and then $1.82 per unit for labor and materials.
a) Draw a graph illustrating the crossover (or indifference) point.
b) Determine the number of units where either choice has the same cost.
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Related Book For
Operations Management: Sustainability And Supply Chain Management
ISBN: 9780135225899,9780135202722
13th Edition
Authors: Jay Heizer; Barry Render; Chuck Munson
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