1. A startup company is considering making a part by injection molding. The part is moderately complex and the volume of the part is about 10 cubic centimeters. Assume that the part is designed for injection molding and can be made with a two part mold. The company needs to make 250,000 parts made from ABS plastic. Once the mold is made it will take a worker 1 minute to make one part using the injection molding machine. The company will use contract manufacturing to produce the parts. Estimate the cost per part and explain how you came up with the number. (If you are stuck look at the Contract Manufacturing Cost per Unit section. Also keep in mind that there is no exact right answer, the goal is to come up with a reasonable estimate.)

2. Contract Manufacturing Cost per Unit: Its not uncommon to hire another company to perform some or all the manufacturing for a product. To estimate the cost use

   ((Cost of Parts and Materials) + (man hours) $40)/.75