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As a result of increased sales, iMedia needs 350,000 jewel-case liners rather than 200,000. iMedia has enough existing capacity to make all of the liners

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As a result of increased sales, iMedia needs 350,000 jewel-case liners rather than 200,000. iMedia has enough existing capacity to make all of the liners it needs. In addition, due to volume discounts, its variable costs of making each liner will decline to $0.28 per liner. Assume that by outsourcing, iMedia can reduce its current fixed costs ($44,000) by $12,500. There is no alternative use for the factory space freed through outsourcing, so it will just remain idle. What is the maximum iMedia will pay to outsource production of its CD liners? Begin by identifying the basic formula that is used to determine the indifferent outsourcing cost per unit. Cost if making liners Cost if outsourcing liners Using the basic formula you determined above solve for the indifferent outsourcing cost per unit. (Round the per unit calculation to three decimal places.) The maximum iMedia will pay to outsource production of its CD liners is $ per unit. (Enter amounts to three decimal places.) iMedia would be indifferent between outsourcing and making the liners if the outsourcing price was $ perliner. Therefore, iMedia will only be willing to outsource if the outsourcing price were per liner

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