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4. A company has extra capacity that can be used to produce a sophisticated fixture which it has been buying for RO 900 each. If
4. A company has extra capacity that can be used to produce a sophisticated fixture which it has been buying for RO 900 each. If the company makes the fixtures, it will incur materials cost of RO 300 per unit, labour costs of RO 250 per unit, and variable overhead costs of RO 100 per unit. The annual fixed cost associated with the unused capacity is RO 10,00,000. Demand over the next year is estimated at 5,000 units. (i) Calculate the Cost to Make. (ii) Calculate the Cost to buy. (iii) Would it be profitable for the company to make the fixtures
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