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Augusta Industries has just signed an agreement to outsource production of one of its most popular products. It will still be manufactured to Augustas standards
Augusta Industries has just signed an agreement to outsource production of one of its most popular products. It will still be manufactured to Augustas standards and will still carry the Augusta insignia. Which of the following is likely to result from this decision? 1. A decrease in operating leverage. 2. A decrease in both variable and fixed costs.
A : Neither 1 nor 2
. B : 1 only.
C : 2 only.
D : Both 1 and 2.
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