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A manager is trying to decide whether to purchase a certain part or to have it produced internally. Internal production could use either of

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A manager is trying to decide whether to purchase a certain part or to have it produced internally. Internal production could use either of two processes. One would entail a variable cost of $13 per unit and an annual fixed cost of $213,000; the other would entail a variable cost of $10 per unit and an annual fixed cost of $240,000. Three vendors are willing to provide the part. Vendor A has a price of $18 per unit for any annual quantity up to 30,000 units. Vendor B has a price of $21 per unit if demand is 1,000 units or less, but $14 per unit (for all units) if demand is greater. Vendor C offers a price of $20 per unit for the first 1,000 units, and $18 per unit for additional units. a-1. If the manager anticipates an annual demand of 10,000 units, which alternative would be best from a cost standpoint? O Vendor A Vendor B Vendor C O Internal 1 O Internal 2 a-2. If the manager anticipates an annual demand of 60,000 units, which alternative would be best from a cost standpoint? Vendor A and Internal 1 O Vendor B and Internal 1 O Vendor C and Internal 1 O Vendor C and Internal 2 O Vendor B and Internal 2 b-1. Determine the range for which each alternative is best? Range 1 to 1000 1,001 to 60,000 60,000 or more Optimal Choice (Click to select) v (Click to select) (Click to select) b-2. Are there any alternatives that are never best, If so, which ones? Internal 2 and Vendor B are never best. O Internal 1 and Vendor C are never best. O Internal 1 and Vendor A are never best.

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